LBC plans P1.2B follow-on offer by Q1 2017

Leading local logistics firm LBC Express Holdings Inc. plans to seek regulatory authority to raise as much as P1.17 billion from a follow-on offering of shares by the first quarter of next year.

LBC Express Holdings president and chief operating officer Mike Camahort said in a press briefing on Thursday that the company was targeting to file at the Securities and Exchange Commission by the end of this month a new prospectus to offer up to 10 million primary shares and 59 million secondary shares at the maximum price of P17 per share.

Based on the timing of the submission of new prospectus, he said the offering could be launched by the first quarter of 2017.

The company has thus rekindled its old follow-on offering plan, targeting to sell the same number of primary and secondary shares but raising the maximum offering price from P12 per share previously.

At the offering price of P17 per share, LBC is expected to end with a market capitalization of P20 to P24 billion. Shareholder dilution is not expected to exceed 10 percent.

Camahort said UBS was acting as LBC’s financial adviser but since the size of the offering was more suitable for the the domestic market, the company had tapped only one local underwriter to handle this equity deal. PCCI Securities Brokers Corp. got the mandate.

The LBC executive said the company would be happy to offer shares at a price of 18 to 20 times the kind of money that investors expect to make per share that they own.

The company entered the local stock market last year using the back-door listing route last year, with Federal Resources Investment Group Inc. as its vehicle.

Meanwhile, LBC expects to meet its goal of hitting P1 billion net profit before tax this year from around P687 million in 2015. The bottomline level for full-2016 will still be close to P1 billion after tax, Camafort said.

In the first nine months, LBC’s attributable net profit rose by 54 percent year-on-year to P627.34 million. For the third quarter alone, net profit doubled to P208.7 million from P104.64 million in the same period last year.

Revenues for the nine-month period rose by 11.4 percent year-on-year to P6.36 billion.

“LBC’s strong financial performance for the third quarter was driven by the company’s focus on expanding our portfolio of business solutions simultaneous with our push to continuously improve our express delivery service. It’s a trend that we see continuing as we move into the last quarter of the year, which is typically the industry’s peak season,” said Camahort.

Logistics remains the core business of LBC, contributing 87 percent of its revenue. Within its logistics business, retail retains the lion share while exponential growth is expected from the corporate unit.