Exited UKC Holdings Corp (TYO:3156)

So UKC hit a valuation of above net current assets a lot sooner than I expected. Not because the share price took of on a rocket, but because the company made large write-downs of receivables and prepayments.

The share has traded up since I took my position, but I feel a bit anxious about the write-downs so I sold. You know “Misfortunes never come singly” – there could be more problems with the books. The need to put together an independent audit committee indicates managerial problems.

Exited at ¥1922, so return of about +17 % in 5 weeks.


Entered UKC Holdings Corp (TYO:3156)

UKC Holdings is engaged in the sales and distribution of semiconductor and electrical components. It´s a typical Japanese net-net low margin business. Entered at ¥1630 or a NCAV ratio of about 0.51. The company pays dividends and have some IR info in English.

Current assets  ¥  134 895 000
Total liabilities  ¥   85 111 000
Net current assets  ¥   49 784 000
Market cap  ¥   25 500 000
Ratio 51%