What Does Kingsmen Creatives Ltd Do and How Does it Make its Money?
It is important to know what a particular company does and how it makes its money before investing in it. Investing in a business without such knowledge is akin to travelling to an unknown territory without a map.
On this note, let’s take a look at what business Kingsmen Creatives Ltd (SGX: 5MZ) is involved with and how it generates its revenue.
Kingsmen, which celebrated its 40th anniversary last year, has four business segments and the table below shows their respective revenue contributions in the company’s financial year ended 31 December 2016 (FY2016):
Source: Kingsmen’s Annual Report 2016
Revenue from Exhibitions and Thematic, which made up 45.9% of the firm’s total revenue in FY2016, was at around S$151 million.
Under this business segment, Kingsmen is involved in the production of exhibition displays for trade shows and promotional events, and interiors and displays for museums and visitor centres. It also creates thematic and scenic displays for theme parks. Some of the key contributors to the division’s revenue for the financial year included Formula 1 Grand Prix, Singapore Airshow 2016, and KidZania Singapore.
Moving on, the Retail and Corporate Interiors business division, which contributed to 45.6% of total revenue, provides interior fitting-out services to retail and commercial properties. Some of the key accounts include clients and brand names such as Coach Inc (NYSE: COH), DBS Group Holdings Ltd (SGX: D05), and Uniqlo.
Next, the Research & Design division, which brought in around S$15 million to the top line, is involved in design works for upmarket specialty stores, departmental stores, and showrooms, among others. Changi Airport Group, Under Armour Inc (NYSE: UA), and Burberry Group plc (LON: BRBY) were some of the clients it serviced for the financial year.
Last but not the least, the Alternative Marketing division provides event management, branding consultancy services, and custom publishing. It raked in revenue of close to S$13 million for FY2016. The main contributors to sales were clients like CPF Board, Health Promotion Board, and StarHub Ltd. (SGX: CC3).
Behind every ticker symbol lies a living, breathing business. Buying a stock without fundamental knowledge of what the company does and how it makes money can be dangerous.
Once we know the basics of a company’s revenue streams, we can then delve into other aspects of the firm such as its profitability, strength of its balance sheet, its cash generating abilities, and more.