Headline summary
Gateway Services flat
Food Solutions growth of 2-3%
Attempt to predict Q1 FY2015/16 results
Business segment proportion of revenue:
60% Food solutions
40% Gateway
Geographical proportion of revenue:
Singapore 82%
Japan 13%
Others 5%
Take a look at Q1 FY2014/15 aviation operating metric first.
Overall Singapore aviation operating metric last year was up about 1.5-2% (heavier on Food Solutions)
Overall Singapore revenue (actual) for the quarter was up 1.3%. **Food Solutions revenue dropped despite the growth in Singapore's metric was due to weakening Yen.
So, let's try to extrapolate this to Q1 FY2015/16 result,
Singapore revenue to similarly grow about 2%
Food Solutions to remain flat.
WHY?
Although more meals were produced (2.5% YoY growth) in Singapore, the Japanese Yen has considerably weakened against the SGD from 2014 to 2015 (largely due to QE in Japan). This weakening of the Yen is expected to offset the moderate growth in Singapore's revenue.
The Bottomline?
I still expect EBITDA to growth around the 6-7% range (Q4 FY14/15 = 7.2%) mainly due to continued cost management effort. Will continue to add on price weakness, but it doesn't seem like the price will be weak anytime soon.
Disclaimer!
But of course, all these are mere guesses and me being bored. I have never proclaimed to be pro at earnings estimates. I'm just trying to have some wild guesses and also hone my analysis capabilities.
Cheers!
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