Gold and Yikon: Part II

Flashback: (see Gold and Yikon )

I still retain Yikon as my top pick. When I introduced the stock, it was RM2.50 a share and now it's RM4.40 after six months. The counter has been ignored. Not much research has been done due to the fact that it's a second board stock.

But look at its business model, which comprises 100% gold exports, and gold has done very well. I think gold will continue to go up from about US$510 an ounce now to my target of US$800 or US$900 in two or three years.

Given Yikon's 100% exports to Hong Kong, can you imagine a Malaysian company exporting gold to Hong Kong, the Middle East, and India and China, and with its franchise of goldsmith shops in China? The potential is great.

They have opened 11 goldsmith shops in China, and are opening a 12th one next month. Of course, its current PE is very high, but I think people are looking at its potential in China. Yikon is the only gold manufacturing company in Malaysia, and is cash rich.

The company has a huge state-of-the-art plant in Penang. If you look at the Singapore company that manufactures gold wafers like them, you can see that Yikon's technology and machines are far more advanced than those of its Singapore counterpart, which is a smaller company.

Yikon buys scrap gold and processes that into pure gold wafers. The gold jewellery you buy is 91.6% pure and Yikon makes pure gold wafers of 99.9% purity.

Well.... Yikon announced its 2005 Q4 earnings today.

Quarterly rpt on consolidated results for the financial period ended 31/10/2005

Sales 56.517 million
Net earnings 21 thousand.

Yup, a net profit of 21 thousand for this quarter.

Which meant that Yikon's net earnings for fy 2005 is 327 thousand.

327 thousand ringgit and not 327 million ringgit!

:P

What? Where is Ze Moola?

Yikon closed todat at 4.76. This company is worth some 195 million!

Is there gold in there or what?

:P