Straco Corporation Limited is a Singapore developer, operator and investor of premier attractions and tourism-related projects in China. Its businesses include the operation of Shanghai Ocean Aquarium, Underwater World Xiamen, The Lixing Cable-Car, and production of entertainment shows.
The company is highly free cash-flow generative and thus, it has paid consistently increasing dividends over the past six years. Last year, Straco paid a gross dividend of 0.75 cents per share and a special dividend of 0.5 cents per share, giving a total payout of 1.25 cents per share.
The company is valued at around 13 times earnings and its dividend yield is 2.5%, excluding the special dividend. The yield jumps to 4.2% if we the special dividend is included.
The bulk of profit comes from Shanghai Ocean Aquarium and Underwater World Xiamen. If these two attractions can accommodate more visitors, there is scope for higher profit.
Any idea on whether the two are already packed during peak periods?
I have just checked and found that in past years, Straco has never given an interim dividend. Will it be different this time when the net cash pile has gone beyond S$100 million?
