UOS racks up another strong result

Is UOS a company Ben Graham would have bought?

United Overseas Australia Limited (ASX:UOS) announced its half year results on 30 August 2012. Net profit came in at slightly under $61m for the half, and a dividend of 0.5 cents was declared.

Once again, investors were presented with a rock solid balance sheet:

Cash $217m
Receivables $81.8m
Inventories $226.5m
Land held for property development $67.2m
Property plant and equipment $24m
Investment properties $556.6m
Total of Asset Items above $1,173m
Financial liabilities $128 m

It is most remarkable that the balance sheet remains a Fort Knox even after payment of $80m as a return of capital in January 2012, and a further payment of $15m as a dividend in May 2012.

UOS also disclosed that it has entered into contracts to sell two of its investment properties.  Given that both sales are at prices above values carried on the balance sheet, shareholders can have more confidence on the valuation of the investment properties held on the balance sheet.  After all, the market capitalisation of UOS is only AUD$428m.  The Net Tangible Asset per share for UOS is slightly under 95 cents, and these shares are available for purchase at less than half of that value.

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Motley Fool contributor Peter Phan owns shares in UOS. The Motley Fool‘s purpose is to help the world invest, better. Take Stock is The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it’s still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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