Apr 2006 Financial News

Prestige Releases First Quarter Results

Apr 10, 2006

In the unaudited first quarter results for the period ended February 28, 2006, Prestige Holdings Limited (PHL), reported an EPS (diluted) of 7.06 cents. This represents a decline of 28.32% from the same period last year (9.86 cents). The reduced bottom line disclosed, came despite an increased number of operating restaurants. The company experienced marginal increase in revenues (3%), however, these were matched by more significant increases in Costs of Sales and Operating Restaurant Expenses, which eroded the profits of the restaurant group. Within the quarter the Group faced the challenges of the fears of the “Bird Flu” epidemic facing the world as well as the negative fall-out of the Aspergillosis Fungus, which created quite a stir locally.

At the current share price of $10.00 and running EPS of 43.6 cents, the shares of PHL are trading at a P/E multiple of 22.94 times. The share price of PHL has displayed some downward movement recently, due in most part to its relatively high multiple. Given the drop in performance in the first quarter, and the resulting higher multiple, the expectation is for further downward pressure on the share price. As a result we recommend a SELL on this share.

Jason Gokool
WISE Research Team