Daily Brief Equity Bottom-Up: Dream International (1126 HK) FY24 Results and Concall Update: Margins Bounce Back and more

• Dream International (1126 HK) posted strong results, with revenues up 2% and profits down 11% YoY, demonstrating effective cost control in a challenging competitive environment.
• Net cash on the balance sheet ended at 1.52 bn HKD (vs 1.35 bn), representing 33% of market capitalization. The company rewarded shareholders with 60 cents of dividend (~8.9% yield). 
• Trading at 6x/3x PE/EV-EBITDA FY24, with an 8.9% dividend yield and an average 10-year ROCE of 20%, the stock is worth exploring from here. 

• We remain steadfast in our belief in our company’s future. That said, there are no quick fixes. We need to demonstrate consistent execution and results over a sustained period. Frank Yeary
• Intel’s ELT scored themselves a remarkable 29.7 out of 35 for their 2024 “Product Leadership” goal, despite mounting data center market share loss and Gaudi being an abject failure
• While Pat Gelsinger’s departure from Intel was labelled a “retirement” last December, the Proxy Statement refers to it as a “resignation”. Which was it?

• The Swedish startup has formally filed for a US IPO and is aiming to raise $1 billion, at a valuation of between $15 billion and $20 billion. 
• Buy now, pay later is one of the biggest shifts in modern finance. Klarna isn’t just BNPL anymore: it has a whole shopping and payments ecosystem.
• Klarna may be a heavyweight in BNPL, but it’s not alone in the ring. Heavy hitters like Affirm, Afterpay, and PayPal are also scrambling for dominance.

• CNMC Goldmine Holdings (CNMC SP) is a cash-rich (net cash: 20 million SGD) gold play listed on the SGX with assets in Malaysia. Its market cap is 155 million SGD.
• The company is a high-cost gold play, with cash costs of 1200 USD/oz excluding royalties. It is in the process of ramping production from 26,000 oz to 34,000 oz/annum.
• Based on a 3000 USD/oz gold price, the stock trades at 5.7x PE, 4.0x EV-EBITDA with a 2.9% dividend yield (based on a 30% payout ratio). 

• WNS Holdings reported its fiscal 2025 third-quarter results, highlighting some key financial metrics and operational dynamics.
• The company achieved net revenue of $319.1 million, marking a year over-year increase of 1% on a reported basis, though it remained flat when adjusted for constant currency.
• Sequentially, however, there was a more robust performance with revenue increasing by 2.7% on a reported basis and 3.2% in constant currency terms.

• American Express Global Business Travel reported strong financial performance for the fourth quarter and full year of 2024, showcasing a record year for adjusted EBITDA and revenue.
• The company exceeded the midpoint of its guidance range, with adjusted EBITDA rising by 26% year-over-year.
• These results were driven by growth in technology-enabled productivity, a scalable cost base, and robust free cash flow generation.

• As of today, Walmart finds itself at a crossroads.
• The retail giant, long seen as a haven during economic uncertainty, saw its market capitalization drop by nearly $22 billion in a single day after the Conference Board reported that U.S. consumer confidence hit a 12-year low.
• This marks the fourth consecutive monthly decline, with the expectations index plummeting to 65.2 — a level that typically signals a looming recession.

• Spectrum Brands Holdings, Inc. had a mixed first quarter of fiscal year 2025, as revealed in their recent financial results.
• The company experienced a modest increase in net sales, driven by strategic investments and several successful initiatives across its business segments.
• Net sales grew by 1.2% overall, with organic sales, excluding unfavorable foreign exchange impacts, rising by 1.9%.

• GoodRx, the company focused on providing users with discounts on prescriptions and other healthcare services, recently reported its financial results for the fourth quarter and full year of 2024.
• The company highlighted several strategic initiatives and partnerships aimed at driving future growth, including enhanced partnerships with pharmacies, pharmaceutical manufacturers, and healthcare professionals.
• In terms of financial performance, GoodRx posted fourth-quarter revenue of $198.6 million and an adjusted EBITDA of $67.1 million.

Refocusing a business takes time, especially when it involves replacing legacy systems, renegotiating framework agreements, integrating numerous acquisitions and rebuilding the balance sheet. The process becomes even more challenging if it coincides with weak market conditions and a significant level of geopolitical uncertainty. Dustin Group’s management is actively addressing these challenges, including a rights issue announced with its results. The business is well positioned, leaving investors with one key question: when is the right time to buy? We believe the next six months may provide the answer.