Wednesday, 15 February 2012

Dialog rises on higher 2Q earnings

KUALA LUMPUR (Feb 15): DIALOG GROUP BHD [] shares advanced on Wednesday after its earnings rose 15.1% to 41.45 million in the second quarter ended Dec 31, 2011 from RM35.99 million a year ago, boosted by higher revenue from the consolidation of its new businesses and operations.

At 9.05am, Dialog rose three sen to RM2.47 with 424,600 shares traded.

Its revenue increased at a stronger pace of 33.5% to RM358.62 million from RM268.53 million. Its earnings per share were 2.10 sen compared with 1.84 sen.

MIDF Research maintained its Buy rating on Dialog with an unchanged target price of RM2.80.

The research house said in a note Wednesday that it was adjusting its earnings estimate marginally by -3.4%, taking into account lower-than-expected revenue recognition but offset by higher-than-expected contribution from the associate & JCE (refer to the CTF business).

“Earnings outlook is still promising for Dialog with estimated 3-year (FY11-FY13) CAGR of +26%. Our number has yet to factor in any potential contribution from Balai Cluster Field development.

“Dialog is a proxy play to the government’s initiatives to turn Malaysia into an international oil trading hub. Incentive for petroleum trading is expected to accommodate Dialog’s future expansions,” it said.

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