Dividend Magic

Saving and Investing towards Financial Independence in Malaysia

Dividends

IGB REIT – Annual Report 2015

By
Filed Under: Dividends, Companies in the News, Portfolio - Freedom Fund 4

What is a REIT?

So first and foremost, what is a Real Estate Investment Trust (REIT)? A REIT is a company that owns, and in most cases, operates income-producing real estate. They are listed on the KLSE and its shares are open to the public to purchase.  Learn more about them here in my Complete Guide to REITs in Malaysia.

Now, on to one of my favorite REITs – IGB REIT.

IGB REIT

IGB REIT Annual Report

I was awaiting the arrival of the dividend voucher from IGB REIT when to my surprise, it came together with its annual report in the form of a CD. Personally, I like how companies are mailing their annual reports in a CD instead of the old days when they printed thick copies of the reports and mailed those to every single shareholder.

Before we go into the details, you may download and open IGB REIT’s annual report here: IGBReit AR15

For the benefit of those who don’t know, IGB REIT’s property portfolio consists of Mid Valley Megamall and The Gardens Mall in the Klang Valley. Their main shareholders are IGB Corporation Berhad and Goldis Berhad whose main shareholders are the family of IGB Corp’s co-founder the late Datuk Tan Kim Yeow.

I will attempt to brief everyone on some of the more significant details of IGB REIT.

Balance Sheet

Dear shareholders of IGB REIT, these are yours.

IGB REIT The Gardens Mall

Photo Source: thisismetrixit.blogspot.com

IGB REIT Mid Valley Megamall

Photo Source: mapio.net

There were no significant changes in the REIT’s assets and liabilities, value of the company’s investment properties stood at RM4.9 billion. Mid Valley Megamall is valued at RM3.61 billion and The Gardens Mall at RM1.28 billion by Henry Butcher as at 31 December 2015.

Cashflow

A Real Estate Investment Trust’s (REIT) main source of income comes from rentals and the company’s gross rental income increased by 7% in 2015 to RM380 million a year. I particularly liked that IGB REIT also managed to not only keep expenses low, they were able to reduce it by almost RM3 million a year.

However, a lower net profit was declared for 2015 mainly because there was no changes in the fair value of the REIT’s properties. Generally most properties held by REITs would have an increase in value every year, I am not concerned with this aspect of IGB REIT because fair value of properties are paper gains, the true value of a REIT comes from its rental income.

Apart from rental income, I’d like to bring your attention to their Other Income section mainly car park, advertising an kiosk rental. The REIT is rakin in RM44 million a year in parking fees alone, RM6 million for advertisements and a cool RM23 million from renting out kiosk booths. All of which have increased compared to 2014.

My Holdings

IGB REIT has been in my PORTFOLIO since July 2015 with my gross investment at RM1.3152. I’ve been adding to my position when the price was right. As of today (3/3/16), the market price is RM1.54, giving me an unrealized capital gain of 16.33%. I have also received dividend income from IGB REIT recently amounting to RM766.08. Total gains including dividends received stands at 20.93%.

At the current price, dividend yield for the REIT is still above 5%, I will consider disposing off some of my shares in IGB REIT when the yield dips below the 5% mark and will top up on the REIT depending on their next quarterly results.

Do you own any REITs in your investment portfolio? 

Thanks for reading.

A Review of 2015

By
Filed Under: Dividends, Investment, Portfolio - Freedom Fund 11

The Year 2015

Like most years, the year 2015 had its ups and downs.

My stock holdings as at 31 December 2015 can be found in the table below.

No. Stock Quantity Gross
Investment
(RM)		 Dividends
(RM)		 Div. Yield
1 AFG 2,100 10,038.00 302.40 3.01%
2 AIR ASIA 4,300 7,138.00 – 0.00%
3 AXREIT 14,236 24,313.66 773.89 3.18%
4 BONIA 33,700 26,990.33 421.25 1.56%
5 CBIP 10,000 14,425.00 600.00 4.16%
6 CYPARK 8,200 17,681.66 410.00 2.32%
7 HLFG 700 10,528.00 266.00 2.53%
8 HOMERIZ 8,300 14,127.21 624.05 4.42%
9 IGB REIT 22,800 20,030.56 612.56 3.06%
10 MAYBANK 1,500 12,450.00 – 0.00%
11 NESTLE 200 13,376.00 610.00 4.56%
12 SCIENTX 3,800 22,267.24 680.00 3.05%
13 SUNCON 360 – – 0.00%
14 SUNREIT 13,600 19,839.68 685.75 3.46%
15 SUNWAY 3,600 11,264.04 1,332.00 11.83%
16 TUNEPRO 10,800 18,503.64 226.24 1.22%
17 UOA REIT 7,000 10,920.00 – 0.00%
254,382.62 7,544.14 2.97%

*Sunway Berhad paid out a one-time special dividend when its subsidiary Sunway Construction went public in 2015, hence the 11.83% yield.

You may notice that some of my investments gave me a 0% dividend yield, this is because I purchased them recently and did not receive any dividends from them with the exception of Air Asia which doesn’t pay dividends.

Capital Gains

Dividend Magic - A review of 2015

Photo source: insidetherockposterframe.blogspot.my

As at 31 December 2015, my portfolio registered an unrealized gain of 6.5%.

Now this figure might be important to some of you but for me, dividends and its growth are what matters to me. Combined with my dividend yield of 2.97% for 2015, my portfolio’s total gain was a cool 9.5%. Not too high compared to some of the players out there, but I’d take a steady growth in my investments every year over erratic volatility in them any time.

 Top 3 Performers

  1. Scientex Berhad
  2. CBIP Berhad
  3. Homeriz Berhad

I will be actively looking to add more of these 3 stocks to my portfolio in 2016 provided the price is right. Scientex (which is covered here) and CBIP Berhad have both delivered consistently. Homeriz’s financials has been helped greatly by the devaluation of the ringgit which saw my investments double in 2015.

Disappointments

  1. Bonia Berhad
  2. Cypark Berhad
  3. Alliance Financial Group
  4. Air Asia
  5. Tunepro (formerly Tune Insurance)

Collectively, these 5 companies cost me RM14K in unrealized losses. However, the dividends received from them were pretty solid with the exception of Air Asia and Tunepro. I will continue to hold on to them provided the fundamentals remain.

Dividends

I received RM7,544 through dividends alone in 2015, surpassing my target of RM6K per annum. The dividends earned will all be reinvested into the portfolio, letting the 8th wonder of the world work its magic – compound interest.

My next target would be RM8,500 per annum translating to just over RM700 per month, which should in theory be able to cover my most basic living expenses (if I live frugally).

Ultimately, I aim to be able to cover all my living expenses through dividends alone.

I view my investment portfolio as a young tree, with each stock its own branch, branches which I would think long and hard before I’d ever consider chopping them off. Each and every branch of this wonderful tree produces bountiful fruit – in the form of dividends which is what I’ll eventually live off of, choosing to pluck the fruit and leave the branches intact rather than cutting the branches. What with me working and all now, I am fortunate enough to be able to replant those fruits instead of consuming them – reinvesting my dividends every year will eventually snowball into a huge sum in the long term.

Patience is very tough at times, but my progress thus far is proof that patience and persistence works. Since I started investing in 2014, my passive income has been steadily increasing every single year. It takes a little time for this to start noticeably working, but the additional cash flow is real.

We Can Do It!

CC Image Rosie the Riveter courtesy of The U.S. National Archives on Flickr

Fin

 

Dividend Income Update 2015

By
Filed Under: Investment, Dividends 5

A list of my past dividend income and updates can be found below:

December & November

You’d noticed I skipped dividends for the month of November due to the simple fact that there were none in that month. =D

The last month of 2015 however saw me receive dividends from 5 different companies – Sunway REIT, Nestle Bhd, Axis REIT, Alliance Financial Group Bhd and Hong Leong Financial Group Bhd for a total of RM937.51.

This wraps up the dividends from 2015. My total dividends received for the year is RM7,544.14 translating to a yield of 3.12%.

A little low for my liking and I hope to improve my yield to at least 5% within the next 2 years.

A summary of my investments for 2015 will be posted soon, I’m ironing out the details as of now.  Thank you and goodbye 2015.

October

The month of October only saw me receiving dividends from a single company – Sunway Berhad.

As some of you may know, Sunway recently listed their construction arm as Sunway Construction Group Berhad. As a Sunway Bhd shareholder, I received some shares in the newly listed company as well as a share in the profits from the listing in the form of a one-time special dividend.

I also received Sunway’s usual dividend.

The special dividend bumped my dividend yield from Sunway Bhd to almost 12% this year.

Overall portfolio dividend yield increased to 2.74% for the year.
I do not expect to receive dividends for the month of November.

I’m keeping an eye on the shares listed below:

  1. Bonia
  2. Axis REIT
  3. Public Bank
  4. Spritzer

Cheers!

September

The month of September reaped some rewards for my portfolio.

With the market taking Malaysian investors on a roller coaster ride the past month, the dividends have kept me grounded and on track. As of the third quarter of 2015, portfolio is up by 4.23% for the year 2015.

Total dividends received for the month of September is RM910.89.
The dividend yield for the year is currently at 2.46%.

August & July

RM1,398.94

Sorry folks for the late post, I’ve been busy lately with work. Without further ado, my dividends for both July and August.

Total dividend yield as of today stands at 2.06%.

The Malaysian economy has tanked horribly these past 2 months, I’ve added a little of IGB REIT but I’m planning to hold more cash for upcoming opportunities.

June

June has come and gone, and the mid year brought about dividends from four different companies for myself.

YTL Hospitality REIT – RM201.05

Hong Leong Financial Group – RM175.00

Alliance Financial Group – RM134.40

Cypark Resources Bhd – RM410.00

Will be looking to add more Tune Insurance shares as the price has dropped rather significantly lately.

Cheers.

May

Another dividend I received in May came from Axis REIT.

I apologise for the 2-part post as I received it in my mail together with Axis’ annual report a little late.

IMG_2073

With this, my dividend yield as of 3 June stands at 0.94%.

A few annual reports arrived as well.

IMG_2075

Will spend my time happily reading through them to find out what my investments have been up to.

Until then, cheers!

April

I received a single dividend distribution from Nestle Bhd of RM 350. Portfolio’s dividend yield currently stands at around 0.85%.

War chest balance: RM10K.

I bought more Homeritz and Bonia stocks throughout April, both at reasonable prices of RM1.05 and RM1.03.

March

I received 2 dividend distributions from Sunway REIT and Axis REIT respectively for a total of RM 185.50. Portfolio’s dividend yield currently stands at around 0.6%.

War chest balance: RM25K.

A few transactions were made in March. I bought IGB REIT (RM 1.33) and added more Scientex (RM 6.61) and Axis REIT (RM 3.51). Sold off PRLEXUS and FARMBES, realizing a gain of 26.11% and 4.52% respectively.

February

The dividend received in February is from Homeritz amounting to RM 257.30.
Portfolio’s dividend yield currently stands at around 0.55%.

SunREIT’s dividend mentioned in my previous post will be credited only on 3rd March 2015.

January

As shown above, I received 3 dividend distributions from CBIP, Scientex, and Supermax respectively for a total of RM730.00.
Portfolio’s dividend yield currently stands at around 0.4%.

These will be put in FD before reinvesting in March.
The next expected dividend will be in February from SunREIT.

Scientex Berhad – 2015 Annual Report

By
Filed Under: Dividends, Investment, Portfolio - Freedom Fund 2

Scientex Berhad

Received a copy of my 2015 annual report in the mail for one of my favorite companies – Scientex Berhad.

Scientex Berhad Annual Report
It came in a CD.

I won’t bore you with their numbers and figures, you can have a look at their annual report yourself at the end of this post. I’ll upload it as they have yet to upload it onto their website last I checked.

Scientex Berhad Financial Highlights
Check out their 5-year performance as taken from their Annual Report

Anyway, I came across this little known company back in the year 2013, and added a small slice of the company to my humble portfolio back then. Since then, I’ve made two additional purchases and I’m thinking of purchasing more when the price is right. Scientex currently makes up around 11% of my overall portfolio.

So far, the dividends I’ve received from Scientex have been steadily increasing. With the 13 cents dividend per share declared by Scientex, my yield comes up to 3.75% for the year 2015. This is of course excluding the capital gain of 39%  over the past 2 years.

Scientex has been and will always be in the manufacturing industry. They’ve recently constructed a new plant in Melaka which is due to start production in December 2015 – which should see an increase in revenue.

Their venture into the property development industry was also a successful one. I have to admit, I was a little apprehensive when Scientex started pouring resources into developments but to my delight, it turned out to be a brilliant move. I’ve viewed their properties in Melaka and was quite impressed with the quality and also response from the buyers.

There it is, my short summary on one of the longest held shares in a company. The entire annual report can be found here: ScientexAR_2015

Enjoy and cheers!

Incorporation of a Sdn Bhd

By
Filed Under: Dividends 1

I incorporated a Company back in 6 March 2014.

I would like to share my experience and the whole process as it can be tedious and also confusing with the various laws and statutes to comply with, not to mention the forms. This is a 2 dollar company with 2 shareholders. The Company will have its own business and I intend to invest the profits in the stock market.
As mentioned, with the help of a Company Secretary (“Cosec”), S.I. Sdn Bhd was incorporated in March. Fees incurred was around RM1,500.00. Most Cosecs will offer audit and taxation services which I will discuss later.
The documents were prepared by the Cosec with me having to provide a copy of my I.C. and eventually signing all the documents.
It is important to engage a responsible Cosec. I looked around and also asked most of my mentors and friends for recommendations. This would be the best way because a recommended Cosec will put in more effort and treat you better as they were recommended by an existing client.