Monday, 28 July 2014
Elevance Renewable Sciences Inc. hit another milestone on its long march to becoming one of the first companies to produce commercially viable chemicals from renewable resources, such as plant oils.
The Woodridge-based company is commercializing technology developed more than a decade ago by a Nobel Prize-winning researcher from the California Institute of Technology to make specialty chemicals for cosmetics, detergents and industrial lubricants.
Now it's teaming with a subsidiary of Malaysian conglomerate Genting Group to build another biorefinery using palm oil. Elevance will own 25 percent of the refinery in Malaysia and sell products made there to its customers, which include French chemical giant Arkema Inc. and Northfield-based Stepan Co. Genting also will pay royalties to Elevance on its technology.
Elevance joined with Singapore-based Wilmar International Ltd. to start up the world's largest biorefinery last year in Indonesia and is working to convert a former biodiesel refinery in Natchez, Mississippi, which is expected to come online in 2016.
The partnership with Genting to license Elevance's technology could be important to gaining widespread commercial adoption. That has been the goal since Elevance was spun off from Cargill Inc. in 2007 and K'Lynne Johnson, a Chicago-based former executive with Amoco and BP, took the lead.
Refining is an expensive undertaking even without the risk of new technology. Though it has teamed with several large, global corporations, Elevance has raised nearly $300 million. It employs about 150 people, most of them at its Woodridge headquarters.
Chicago has long been a hub for refining and chemical production, with multiple plants, as well as research and development operations for giants such as Honeywell's UOP subsidiary and BP PLC. If Elevance succeeds, it could help ensure that the region remains a leader in the industry long term.
Friday, 25 July 2014
It’s not always easy for retail investors to gain access to a publicly-listed company’s top-level management to ask questions and gain a deeper understanding of the company’s business – we recognise that at The Motley Fool Singapore.
Thus, when any opportunity arises for me or any of my colleagues to speak to important executives of publicly-listed companies, we would aim to bring you, dear readers, any interesting insights we can glean about the company’s business.
We’ve done that previously with instant beverage manufacturer Super Group (SGX: S10). Now, we’d like to do it with electronics and furniture retailer, Courts Asia (SGX: RE2).
Last week, my colleague Stanley Lim and I had the chance to sit down for a cup of coffee with Courts Asia’s Chief Financial Officer, Ms. Kee Kim Eng, and Regional Head of Strategy Planning & Communications, Ms. Tammy Teo. The indented portions below are six interesting insights Stanley and I heard from Kim and Teo on how Courts Asia manages credit-related risks.
For those unfamiliar with Courts Asia, the sale of goods based on the company’s credit plans (i.e. Courts Asia’s many varieties of instalment plans) makes up roughly 20% of its total sales while the sale of goods based on cash payments constitutes the rest. So, credit control in relation to the sale of goods is pretty important for the company. Without further ado, here are the six insights as promised:
1) For the first three insights, see here.
4) In January this year, Courts Asia announced the expected opening of its first ‘Big-Box’ Megastore in Indonesia in the second quarter of the financial year ending 31 March 2015. The Indonesian Megastore would mark the company’s first foray into another geographical market apart from its traditional stronghold in Singapore and Malaysia.
With Indonesia, the company’s expansion will be very measured. Part of the reason is because Courts Asia wants to build up a strong database in order to better understand the behaviour of Indonesian shoppers when it comes to paying using the company’s credit plans. To mitigate some of the risks involved with issuing credit in a new and relatively alien market, Courts Asia intends to charge a higher average interest rate of 30% (simple interest – i.e. not compounded) for credit sales in the country. In Singapore and Malaysia, the company charges an average interest rate of 22%-23% and 27% respectively.
5) When it comes to customers’ eligibility in using the company’s instalment plans to pay for purchases, Courts Asia does not take things lightly. For instance, 70% and 80% of credit sales (in Malaysia and Singapore, respectively) are made to repeat customers, whose credit and payment histories Courts Asia has intimate knowledge of.
6) Courts Asia actually takes the loans it makes to customers (the company’s ‘loaning’ money to customers when customers sign up for instalment plans) and securitises it with banks. This securitisation process ultimately creates a banking facility with banks (i.e. a sum of money that can be borrowed by Courts Asia) from which the company can draw upon as and when it requires. During the securitisation process, Courts Asia’s loan book would also effectively become an asset for the banks it’s dealing with.
The quality of credit control that Courts Asia displays when it offers its instalment plans to customers was hinted at during the Great Financial Crisis of 2007-09: Back then, the banks which worked with Courts Asia for the securitisation programmes had treated Courts Asia’s loan book as a strong asset (the banks refused to sell Courts Asia’s loan book to raise capital).
Thursday, 24 July 2014
嘉里物流是以香港為基地的最大國際第三方物流服務供應商，於港股中可謂無直接可比較的同業，反而可與國際同業如DHL、DSV及Kuehne & Nage等比較。此外，嘉里物流設施遍及19個國家及地區，尤其於大中華及東盟地區擁有強大和完善的陸路運輸及配送網絡，加上具有為客戶提供綜合物流增值 服務的豐富經驗，的確可協助客戶打入及拓展亞洲及中國市場