Friday 11 May 2012

Works on RM1.5b Samalaju Port to start in January next year

KUCHING (May 11): Works on the interim facilities for the proposed development of the RM1.5 billion Samalaju Port near Bintulu is expected to start by January next year, BINTULU PORT HOLDINGS BHD [] chief executive officer Datuk Mior Ahmad Baiti Mior Lub Ahmad said on Friday.

He said the proposal on the general layout had been submitted to the State Planning Authority on Dec 8, 2011 while PricewaterhouseCoopers had already conducted all the relevant studies and recommendations, including for project funding.

"We are now in the final stages of concluding the deal and the funding aspect has been discussed with our major shareholders involving Petronas, Sarawak State Financial Secretary and Kumpulan Wang Persaraan," he told reporters after Bintulu Port's annual general meeting here.

He said tenders involving several packages for the full development of the port, which was located under the Sarawak Corridor of Renewable Energy (Score), would be called soon.

Once fully operational, he said, Samalaju Port was expected to handle an annual cargo throughput of 18 million metric tonnes compared with 16 million tonnes of non Liquefied Natural Gas (LNG) cargo currently being handled by Bintulu Port.

However, he was confident the cargo volume could rise up to 30 million metric tonnes annually, according to demand, in view of the potentials in the oil and gas industry as well as bulk fertiliser trade during the first phase of development.

The company had been given the task to build, own and operate the proposed port on some 450 hectares of land earmarked by the Sarawak government, he said.

He said Samalaju Port is to serve industries located at Samalaju Industrial Park, 60 km from Bintulu Port and its infrastructure development would be planned accordingly to serve the anticipated cargo generated by the industries within the Score.

Meanwhile, Mior Ahmad Baiti said crude palm oil (CPO) cargo had overtaken container cargo as one of the leading contributors to Bintulu Port's revenue.

With containers being handled at the port relegated to the third leading revenue contributor, he said, the sector saw a drop to 215,451 TEUs (20 foot equivalent units) in 2011 from 251,296 TEUs in 2010.

The group cargo throughput rose by 2.65 per cent to 41.70 million tonnes in 2011 from 40.61 million tonnes in 2010.

LNG still remained the major contributor with 24.89 million tonnes of cargo throughput and the remaining 16.81 million tonnes from non LNG cargoes, he said. — Bernama



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K Seng Seng's 1Q net profit slumps to RM95,000

KUALA LUMPUR: K. Seng Seng Corporation Bhd's net profit plunged 85.41% to RM95,000 in its first quarter ended Mar 31, 2012 from RM651,000 a year ago due to lower purchase orders and fluctuating costs.

In a statement on Bursa Malaysia on Friday, it said revenue fell 8.61% to RM15.18 million from RM16.61 million a year earlier.

Earnings per share were 0.10 sen compared to 0.68 sen.

The group attributed its weak earnings to lower purchase orders from its existing customer base and from the overseas market as well as the fluctuating costs of raw material.



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Malakoff Intl buys indirect stake in Bahrain power, desalination plant

KUALA LUMPUR (May 11): MMC CORPORATION BHD []'s 51%-owned subsidiary Malakoff International Ltd (MIL) has acquired the entire issued and paid up capital of IP Middle East Holding Co Ltd (IPME) from International Power Holdings Ltd (IPR) for US$113.4 million (RM348 million).

In a filing to Bursa Malaysia Securities on Friday, MMC Corp said that as a result of the acquisition, MIL will hold an indirect 40% equity interest in Hidd Power Company B S C (c) Bahrain ("HPC") through IPME, which owns a 57.1% equity interest in IPSUM Hidd Holding Co Ltd, which in turn owns a 70% equity interest in HPC.

"HPC is the owner and operator of a 'Build, Own and Operate' power generation and water desalination plant in Bahrain," it said.

The filing confirmed a report by The Edge Financial Daily on May 3, which said that Malakoff Corp had acquired a 40% stake in Hidd Power Co (HPC), a power and water generation provider located in Bahrain.The deal was signed in Bahrain on Monday, citing reports by the Gulf Daily News and the Bahrain News Agency.



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Weaker regional sentiment weighs KLCI down

KUALA LUMPUR (May 11): The weaker investor sentiment at regional markets weighed on the FBM KLCI and led the benchmark index lower at the mid-day break on Friday.

Asian shares slid on Friday, spawning declines in other risk assets, as deepening political turmoil in the eurozone fuelled concerns about global growth and a huge loss from JPMorgan added to jittery sentiment, according to Reuters.

At the mid-day break, the FBM KLCI fell 1.14 points to 1,586.92.

Losers led gainers by 362 to 176, while 330 counters trade unchanged. Volume was 475.81 million shares valued at RM374.95 million.

The ringgit weakened 0.15% to 3.0725 versus the greenback, crude palm oil futures for the third month delivery fell RM41 per tonne to RM3,299, crude oil lost US$1.27 (RM3.90) per barrel to US$95.81 and gold fell US$9.25 an ounce to US$1,584.77.

At the regional markets, Japan's Nikkei 225 fell 0.48% to 8,966.10, Hong Kong's Hang Seng Index fell 1.18% to 19,989.50, the Shanghai Composite Index shed 0.25% to 2,404.31, Taiwan's Taiex fell 1.23% to 7,391.94, south Korea's Kospi lost 1.37% to 1,918.33 and Singapore's Straits Times Index was down 0.72% to 2,882.77.

On Bursa Malaysia, PPB was the top loser in the morning session and fell 34 sen to RM16.14, BAT lost 30 sen to RM53.70, United PLANTATION []s down 24 sen to RM26.26, GAB 22 sen to RM13.40, Southern Acids 19 sen to RM2.26, Tasek 17 sen to RM9.19, while Milux, Shell and Far East lost 10 sen each to RM1.18, RM9.90 and RM7.55 respectively.

Harvest Court was the most actively traded counter, with 37.29 million shares done. The stock fell 4.5 sen to 58 sen.

Other actives included Utopia, Focus, Ariantec, Permaju, LFE Corp, Naim Indah Corp, CSL, Winsun and Metronic.

Gainers included SAM Engineering, Aeon Credit, Aeon, Tahps, Binutulu Port, BLD Plantations, Malpac and Fiamma.



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Century Logistics dips on RHB Research downgrade, cut in fair value

KUALA LUMPUR (May 11): CENTURY LOGISTICS HOLDINGS BHD [] shares fell on Friday after RHB Research downgraded the stock to Underperform and slashed its fair value to RM1.63 (from RM2.09) and said the company’s 1QFY12 net profit came in below expectations.

At 12.25am, Century fell eight sen to RM1.72 to 186,500 shares done.

“We believe this was mainly due to: (1) start-up losses from the operation of its double hull product tanker; (2) Lower-than-expected contribution from the ship-to-ship (STS) segment; and (3) The ongoing strike by container haulage drivers had indirectly hampered its total logistics segment,” the research house said in a note Friday.

RHB Research said that Century believes its weak 1Q12 earnings was the trough and management was optimistic of better earnings ahead as: (1) Oil transport business to turn profit (from losses currently) in the coming quarters as it increases its frequency; and (2) To reinstate 3-4 additional floating storage units (FSUs) in PTP.

“We have reduced our FY12-14 net profit forecast by 10.5-26.1% respectively after imputing lower contribution from the STS segment.

“Fair value is reduced to RM1.63 based on 8x FY12 FD EPS. Downgrade to Underperform,” it said.



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Strategy: CIMB Research maintains Overweight on Indonesia

KUALA LUMPUR (May 11): CIMB Research has maintained its Overweight rating on Indonesia and said first quarter 2012 (1Q12) results were not quite as strong as 4Q11.

“But 1Q12 results were decent despite disappointments from commodity stocks, offset by strong numbers from PROPERTIES [] and telco,” it said in a strategy note on Friday.

The research house said seventy-one percent of companies met or exceeded expectations versus 74% in 4Q11.

Earnings remain under pressure even after four months of downgrades, it said.

It said risks were emerging in the resource sector, though there was upside for non-resource if fuel prices are left untouched. JCI still underperformed ASEAN-4 despite two good months in Mar-Apr.

“Valuations at 13.1x forward P/E are at their 3-year MA, while PBV of 2.9x has factored in a 3%-pt increase in CoE, in our estimate.

“Our bottom-up index target of 4,450 is intact, implying 15.3-12.8x CY12-13 P/Es, as is our Overweight position. A reversal in earnings downgrades should provide a market catalyst,” it said.



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RHB Research downgrades Century Logistics, slashes fair value to RM1.63

KUALA LUMPUR (May 11): RHB Research has downgraded CENTURY LOGISTICS HOLDINGS BHD [] to Underperform and slashed its fair value to RM1.63 (from RM2.09) and said the company’s 1QFY12 net profit came in below expectations.

“We believe this was mainly due to: (1) start-up losses from the operation of its double hull product tanker; (2) Lower-than-expected contribution from the ship-to-ship (STS) segment; and (3) The ongoing strike by container haulage drivers had indirectly hampered its total logistics segment,” the research house said in a note Friday.

RHB Research said that Century believes its weak 1Q12 earnings was the trough and management was optimistic of better earnings ahead as: (1) Oil transport business to turn profit (from losses currently) in the coming quarters as it increases its frequency; and (2) To reinstate 3-4 additional floating storage units (FSUs) in PTP.

“We have reduced our FY12-14 net profit forecast by 10.5-26.1% respectively after imputing lower contribution from the STS segment.

“Fair value is reduced to RM1.63 based on 8x FY12 FD EPS. Downgrade to Underperform,” it said.



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KLCI edges down at mid-morning in choppy trade

KUALA LUMPUR (May 11): The FBM KLCI edged lower at mid-morning on Friday in choppy trade, in line with the tepid sentiment at key regional markets, and weaker overnight close at Wall Street.

The FBM KLCI edged down 0.01 of a point to 1,588.05 at 10am.

Losers led gainers by 201 to 157, while 243 counters traded unchanged. Volume was 222.23 million shares valued at RM1110.91 million.

BIMB Securities Research in a note Friday said that with Spain currently on a downward economic spiral with Greece scrambling for a government coalition, the US came out with another after market “surprise” that JP Morgan made a US$2bn trading loss.

It said that though the Dow Jones Industrial Average eked out a 20 point gain to 12,855, the JP Morgan incident should dampen investors’ mood.

European markets staged a relief rally of sorts with most ended up in positive territory which we believe could be short lived, it said.

Already, the Spanish banks are crying for help with bail-outs next on the agenda. Regional performances were mixed with Malaysia again defying gravity to chalk up a 3.16 point gain to 1,588.06, it said.

"It is interesting to note that investors’ risks tolerance is higher now with the absence of any panic selling.

"Mirroring our sentiments, we expect the FBM KLCI to trend within a narrow band over the short term of between 1,580-1,600 and expect some downward bias today," it said.

Among the major decliners at mid-morning on Bursa Malaysia were PPB, Tasek, GAB, Orient, Subur Tiasa, MSM, Amway, Century Logistics and Petronas Gas.



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Petronas Gas shares dip after fire at Kerteh plant

KUALALUMPUR (May 11):PETRONAS GAS BHD [] shares retreated on Friday after the company reported a fire incident at its GPP Complex A in Kerteh terengganu on Thurday, in which one person died and two personnel hade been warded.

At 9.26am, PGB fell 10 sen to RM17.18 with 26,200 shares traded.

In a filing Friday, Petronas Gas (PGB) said the fire, which started at 3pm, was brought under control by the Complex's Emergency Response Team at 3.30pm.

The company said the incident happebed at GPP 3 which was under planned maintenance shutdown.

It said there was minimal damage to plan equipment, adding that the incident had not affected the operations of the other gas processing plant units and there was no interruption to the gas suply to the Peninsular Gas Utilisation pipeline network.

"Arising from this incident, there is minimal impact to PGB's earnings," it said.

PGB said that a number of employees of Hyundai-PFCE Consortium (HPC), which is the contractor engaged to undertake the maintenance works at the GPP, were affected by the incident.

"PGB is extending all necessary assistance to the affected personnel and their family members," it said.



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Dialog up in early trade on positive 3Q earnings

KUALA LUMPUR (May 11): DIALOG GROUP BHD []'s shares advanced on Friday after its net profit for the third quarter ended March 31, 2012 rose 7.96% to RM41.39 million from RM38.34 million a year earlier, due mainly to higher revenue and increase in Malaysian operations arising from its provision of specialist products and services, engineering and CONSTRUCTION [] activities and fabrication works.

At 9.20am, Dialog rose five sen to RM2.27 with 292,500 shares traded.

It said on Thursday that revenue for the quarter jumped 39.5% to RM420.04 million from RM301.16 million in 2011, due consolidation of the revenue of the newly acquired fabrication and multi-disciplined engineering company, Fitzroy Engineering Group Ltd, based in New Zealand contributed to the increase in the group's revenue.

Dialog declared an interim 1.1 sen single tier cash dividend per share to be paid on June 29.



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One dead, two warded after fire at PetGas' Kerteh plant

KUALALUMPUR (May 11): One person died and two personnel have been warded following a fire at PETRONAS GAS BHD []'s GPP Complex A in Kerteh, terengganu on Thurday.

In a filing Friday, Petronas Gas (PGB) said the fire, which started at 3pm, was brought under control by the Complex's Emergency Response Team at 3.30pm.

The company said the incident happebed at GPP 3 which was under planned maintenance shutdown.

It said there was minimal damage to plan equipment, adding that the incident had not affected the operations of the other gas processing plant units and there was no interruption to the gas suply to the Peninsular Gas Utilisation pipeline network.

"Arising from this incident, there is minimal impact to PGB's earnings," it said.

PGB said that a number of employees of Hyundai-PFCE Consortium (HPC), which is the contractor engaged to undertake the maintenance works at the GPP, were affected by the incident.

"PGB is extending all necessary assistance to the affected personnel and their family members," it said.



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KLCI edges up, blue chips lead

KUALA LUMPUR (May 11): The FBM KLCI edged up marginally in early trade on Friday, lifted by gains at select blue chips.

The benchmark index added 0.29 of a point to 1,588.35 at 9am.

Gainers led losers by 24 to 15, while 32 counters traded unchanged. Volume was 4.5 million shares valued at RM3.25 million.

Meanwhile, Asian shares retreated on Friday, spooked by JPMorgan's $2 billion huge loss from a failed hedging strategy, with investors warily watching political turmoil in the euro zone as they await new Chinese data for clues on its growth outlook, according to Reuters.

Among the early gainers on Bursa Malaysia were KLK, Multico, Petronas Chemicals, UMW, ECB, PPB, Maybank, IOI Corp, Petronas Gas and Aeon Credit.



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CIMB Research maintains Outperform on Dialog

KUALA LUMPUR (May 11): CIMB Research has maintained its Outperform rating on DIALOG GROUP BHD [] at RM2.22 with a revised target price of RM2.93 (from RM2.95) and said delayed contribution from Phase 1 of the Pengerang terminal was behind Dialog’s results letdown, with 9M net profit coming in at only 60% of our full-year forecast and 63% of consensus estimate.

"But our optimism is intact as the earnings shortfall is purely a timing issue," it said in a note Friday.

"We reduce our FY12 EPS for the timing of Phase 1’s contribution.

"Our target price drops slightly as we update our SOP calculation. We continue to value the businesses at 18.2x P/E, a 40% premium over our CY13 target market P/E of 13x. Potential contracts for the Rapid project and marginal fields underpin our Outperform call," it said.



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Stocks to Watch Genting Group, Glenealy, Cuscapi, Century Logistics, Dialog

KUALA LUMPUR (May 11): The FBM KLCI may cap a tumultuous week on Friday on a weaker note, as external pressures have kept Asian equities in throughout the week, while European and US markets appeared to trend lower on Thursday as well.

European shares were down around midday in choppy trade on Thursday, as political concerns in Europe and global growth worries weighed on investor sentiment with basic resource stocks under pressure after weak trade data overnight from China, according to Reuters.

Meanwhile, S&P 500 futures were flat on Thursday as investors paused from a recent bout of selling ahead of the latest report on the labor market, it said.

Among the stocks that could be in focus are the Genting stable of companies, Glenealy PLANTATION []s (Malaya) Bhd, CUSCAPI BHD [], CENTURY LOGISTICS HOLDINGS BHD [], and DIALOG GROUP BHD [].

The Genting companies declared their final dividends respectively. GENTING BHD [] declared a final gross dividend of 4.5 sen per share of 10 sen each; Genting Malaysia declared a final gross dividend of 4.8 sen per share of 10 sen each, while Genting Plantations declared a final gross dividend of 5.75 sen per share of 50 sen each.

Glenealy's net profit fell 52.97% to RM10.93 million for its third quarter ended Mar 31, from RM23.24 million a year ago, due to lower production volume and higher production costs. It said on Thursday that its revenue for the quarter decreased 13.19% to RM60.02 million from RM69.14 million a year earlier.

Cuscapi's net profit plunged 70.92% to RM567,000 for its first quarter ended Mar 31, from RM1.95 million a year ago, dragged down by delays in uncompleted projects. In a statement on Bursa Malaysia on Thursday, the group said its revenue fell 21.34% to RM12.13 million from RM15.42 million a year earlier.

Century Logistics's net profit fell 33% to RM4.29 million in its first quarter ended Mar 31, from RM6.44 million a year ago due to start-up losses from its double hull product tanker. The company said it would be paying a seven sen final dividend in respect of the financial year ended Dec 31, 2011 on May 25, bringing the total single-tier dividend in respect of the year 2011 to 12 sen per share.

Dialog's net profit for the third quarter ended March 31, 2012 rose 7.96% to RM41.39 million from RM38.34 million a year earlier, due mainly to higher revenue and increase in Malaysian operations arising from its provision of specialist products and services, engineering and CONSTRUCTION [] activities and fabrication works.

It said on Thursday that revenue for the quarter jumped 39.5% to RM420.04 million from RM301.16 million in 2011, due consolidation of the revenue of the newly acquired fabrication and multi-disciplined engineering company, Fitzroy Engineering Group Ltd, based in New Zealand contributed to the increase in the group's revenue. Dialog declared an interim 1.1 sen single tier cash dividend per share to be paid on June 29.



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Thursday 10 May 2012

KWAP's fund size increases to RM82.61b in 1Q2012

KUALA LUMPUR (May 10): The Retirement Fund Inc's (KWAP) fund size increased by 12% or RM8.85 billion to RM82.61 billion in the first quarter 2012 compared to RM73.76 billion in the same quarter of last year.

Its chief executive officer Datuk Azian Mohd Noh in announcing the first quarter 2012 unaudited financial results, said the company's gross investment income increased to RM1.20 billion in the first quarter, which is 6.8% higher than the RM1.13 billion over the corresponding period of 2011.

She said the KWAP achieved a gross return on investment of 1.50%, with net investment income totaling RM1.61 billion.

"The increase is mainly attributed to the strong stock market performance in the first three months of the year, as indicated by the FBM KLCI Index, which surpassed the 1,600-point level.

"In addition, the low interest rate environment also created opportunities for KWAP to intensify the trading activity of its fixed income portfolios, translating into higher capital gains," she in a statement here on Thursday.

She said fixed income assets, namely Malaysian Government Securities, Loans and Private Debt Securities and Money Market instruments, contributed RM299.19 million, RM273.29 million and RM119.18 million respectively, while the remainder came from alternative investments.

Azian said equity investment also contributed RM501.42 million or 42% from the total investment income.

"Some 96% of KWAP's fund are invested domestically with the remaining four%, internationally. International investments are distributed across various asset classes namely fixed income, equity and alternatives which consist of private equity and property," she added.

She said the KWAP has identified various strategies that will add more value to its investments.

"Among others, more funds shall be channeled to external fund managers under the international investment programme covering equities and fixed income. With the set-up of our UK Office, Prima Ekuiti (UK) Limited this year, KWAP's own in-house managers can take the opportunity to build up their expertise beyond the domestic market," she added.

Despite the difficult global environment, Azian said KWAP remains optimistic as domestic demand is anticipated to provide the necessary buffer.

"This, coupled with positive government policies and ample liquidity in the banking system, points towards a potential increase in KWAP's return on investments for 2012," she said. — Bernama



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Consultants appointed to study M'sia-S'pore rapid transit system

KUALA LUMPUR (May 10): Malaysia's Land Public Transport Commission (SPAD) and the Singapore Land Transport Authority (LTA) have appointed consultants to carry out architectural and engineering study on the proposed Malaysia-Singapore Rapid Transit System (RTS).

According to a joint press statement issued after the 9th meeting of the Malaysia-Singapore Ministerial Committee (JMC) for Iskandar Malaysia today, SPAD and the LTA had jointly awarded the tender for the RTS Link Joint Engineering study on May 2.

"The architectural and engineering consultancy study tender was awarded to the consortium of AECOM Singapore Pte Ltd, AECOM Perunding Sdn Bhd and SA Architects Sdn Bhd," it said.

It said the study would determine the technical parameters for the RTS Link between Singapore and Johor Bahru in order to achieve a convenient and cost-effective system that is well-integrated with public transport services on both sides.

The architecture and engineering consultancy consists of two phases.

In Phase I, which is expected to be completed by end-2012, the consultant will look into technical parameters and propose options for the RTS Link.

The JMC for Iskandar Malaysia will then decide on the option to be further studied in Phase II.

The statement said the 9th JMC for Iskandar Malaysia was jointly chaired by Malaysia's Minister in the Prime Minister's Department Tan Sri Nor Mohamed Yakcop and Singapore's Minister for National Development Khaw Boon Wan.

Present at the meeting held at Pulau Springs Resort, Johor Bahru were Johor Menteri Besar Datuk Abdul Ghani Othman and Singapore's Minister for Transport Lui Tuck Yew.

The establishment of the JMC for Iskandar Malaysia was first announced by the prime ministers of Malaysia and Singapore in Langkawi following their meeting in May 2007, with the aim of facilitating cooperation between the two countries in relation to Iskandar Malaysia.

At today's meeting, JMC agreed to the adoption of the terms of reference for a newly formed work group on industrial cooperation to promote mutually beneficial twinning of economic activities between Iskandar Malaysia and Singapore.

At the January 2012 Leaders' Retreat, the two prime ministers have directed that the new work group to be formed for the cooperation.

The statement said the work group would focus on facilitating high value added projects in manufacturing and services sectors which include among others advanced materials manufacturing, electrical & electronics, food processing and creative services.

At the meeting, JMC also agreed to further strengthen bilateral collaboration on the environment and tourism.

Officials from both sides have agreed to continuously collaborate in capacity-building programmes in enhancing the skills and knowledge of officials involved in environmental management, environmental awareness and river cleaning.

Both sides will also explore additional tourism collaborations given the number of new attractions in Iskandar Malaysia and Singapore that are almost ready. — Bernama



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Century Logistics 1Q net profit dips 33% to RM.429m

KUALA LUMPUR (May 10): CENTURY LOGISTICS HOLDINGS BHD []’s net profit fell 33% to RM4.29 million in its first quarter ended March 31, 2012 from RM6.44 million a year ago due to start-up losses from its double hull product tanker.

In a statement on Bursa Malaysia on Thursday, it said that revenue for the quarter decreased 2.19% to RM65.33 million from RM66.79 million.

Earnings per share were 5.32 sen compared to 8.18 sen a year earlier.

Reviewing its performance, the company attributed its decline in earnings to its new double hull product tanker, Onsys Century 1.

On its prospects, the company said it took cognizance of the current uncertain global economic environment and will ensure that it takes the necessary measures to remain resilient, including focusing on providing value-added logistics solutions as well as maintaining cost efficiencies.

“As a result, the Group remains confident of its business model,” it said.

It added that the group was interested to explore business opportunities in South Asia, South America and Africa due to the growing demand for procurement logistics services in those regions.

Century Logistics said it would be paying a seven sen final dividend in respect of the financial year ended Dec 31, 2011 on May 25, bringing the total single-tier dividend in respect of the year 2011 to 12 sen per share.



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Lingui 3Q net profit slumps 80.3% to RM13.59m

KUALA LUMPUR (May 10): LINGUI DEVELOPMENT BHD []’s net profit slumped 80.3% to RM13.59 million for its third quarter ended Mar 31 from RM69.11 million a year ago due to lower extraction volumes and weak demand from Japan.

In a statement on Bursa Malaysia on Thursday, it said revenue for the quarter fell 0.6% to RM374.15 million from RM377.39 million a year earlier.

Earnings per share were 2.06 sen compared to 10.48 sen, whiel net assets per share was RM2.51.

Reviewing its results, the company attributed the weak performance to lower extraction volumes as well as weak demand for timber for reCONSTRUCTION [] activities affected by the Japanese earthquake.

For the nine months ended Mar 31, the group’s revenue rose 11.97% to RM1.31 billion from RM1.17 billion while net profit plunged 81.38% to RM30.53 million from RM163.99 million.

On its prospects, Lingui said the short term outlook for timber industry was expected to be constrained due to more purchasers taking a cautious approach with the uncertain world economic conditions.

It said the timing of Japan’s major reconstruction activities in areas affected by the earthquake and tsunami would be a key impetus for an increase in plywood demand and hopefully selling prices.

“The demand from China for timber products has shown sign of slowing down with implementation of various macro-economic control measures by the Chinese government to curb the over-heating of the Chinese economy.

“Operating under a challenging environment with uncertain outlook and likely greater competition, as various producers strive to increase or at least maintain market share against a likely lower demand base, the Group will continue to manage its cost to remain lean and efficient,” it said.



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ESCAP: M'sia's economy to grow by a slower 4.5% this year

KUALA LUMPUR (May 10): Malaysia's economy is expected to grow by a slower 4.5% this year due to weaker external demand, according to the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).

This is in comparison to the 5.1% in 2011 from 7.2% in 2010.

ESCAP said the fiscal deficit remained at around 5.6% of the gross domestic product (GDP) in 2011 after declining from 7% in 2009 to 5.6% in 2010.

"This was largely due to wide ranging subsidies on the expenditure side and delayed introduction of the goods and services tax (GST) on the revenue side, which remains heavily reliant on oil revenue," it added.

International Centre for Education in Islamic Finance (ICEIF) Professor Emeritus Datuk Dr Mohamed Ariff Abdul Kareem said the local economy would be spurred by domestic demand. However, Mohamed Ariff said Malaysia's budget deficit is a major concern.

"There are already signs that Malaysia's credit rating is under pressure with the risk of downgrading.

"There is a need to rein in expenditure and increase tax revenue," he added, at the launch and briefing of ESCAP's Economic and Social Survey of Asia and the Pacific 2012 here on Thursday. Mohamed Ariff said Malaysia's fiscal deficit at above 3% is a concern.

"The large deficit is attributed to wide-ranging subsidies (4% of GDP) and heavy reliance on oil revenue (40%).

"The saving grace is that debt is largely domestic (less vulnerable to external shocks). But a debt is a debt," he added.

Meanwhile, ESCAP economic affairs officer Dr Oliver Paddison said the Asia-Pacific region will experience slowing growth in 2012 amidst global turbulence.

He attributed this to spillovers of the eurozone turmoil, global oil price hikes, excess liquidity and volatile capital flows.

"The key long-term challenge is high and volatile commodity prices," he added, at a media briefing, on the ESCAP survey.

Paddison said growth is forecast to moderate to 6.5% in 2012 from 7% in 2011 in the Asia Pacific region, with downward pressure from subdued developed economies.

"Despite the slowdown, the region remains an anchor of stability and growth pole for the world economy," he added

He said a major concern is the insufficient job creation in formal sector in developing countries with a high young unemployment with the young three times more likely to be unemployed. — Bernama



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Dialog 3Q net profit rises 7.96% to RM41.39m

KUALA LUMPUR (May 10): DIALOG GROUP BHD [] net profit for the third quarter ended March 31, 2012 rose 7.96% to RM41.39 million from RM38.34 million a year earlier, due mainly to higher revenue and increase in Malaysian operations arising from its provision of specialist products & services, engineering & CONSTRUCTION [] activities and fabrication works.

It said on Thursday that revenue for the quarter jumped 39.5% to RM420.04 million from RM301.16 million in 2011, due consolidation of the revenue of the newly acquired fabrication and multi-disciplined engineering company, Fitzroy Engineering Group Limited, based in New Zealand contributed to the increase in the Group’s revenue.

Earnings per share was 1.75 sen compared to 1.79 sen previously, while net assets per share was 52.66 sen.

For the nine months ended March 31, Dialog’s net profit rose 18.5% to RM127.39 million from RM107.43 million on the back of revenue RM1.13 billion.

Dialog declared an interim 1.1 sen single tier cash dividend per share to be paid on June 29.

Reviewing its performance, Dialog said contribution from Malaysia and Asia operation such as Brunei, Thailand, Middle East and China, also increased significantly mainly due to higher revenue of Specialist Products & Services recorded.

It said its Singapore operation however registered lower revenue mainly affected by lesser works undertaken for its engineering and construction and plant maintenance activities.

On its prospects, Dialog said the development under Economic Transformation Programme in both upstream and downstream sectors would generate tremendous opportunities for the local oil and gas players.

“In this connection, being an integrated specialist technical services provider to the oil, gas and petrochemical industry, the Group will benefit from such opportunities,” it said.

Dialog said the development of the Independent Deepwater Terminal in Pengerang will not only bring in short to medium term contribution from engineering and construction activities in Malaysia, but also long term recurring income when the tank facilities are operational.

“In addition, the Group is investing in the upstream oil and gas opportunities, including the development and production of petroleum under the Small Field Risk Service Contract.

“The Group continues to grow its technical services, such as, its specialist products & services, engineering, procurement, commissioning & construction and plant maintenance services,’ it said.



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Glenealy Plantations 3Q net profit falls 52.97% to RM10.93m

KUALA LUMPUR (May10): Glenealy PLANTATION []s (Malaya) Bhd’s net profit fell 52.97% to RM10.93 million for its third quarter ended Mar 31, from RM23.24 million a year ago, due to lower production volume and higher production costs.

It said on Thursday that its revenue for the quarter decreased 13.19% to RM60.02 million from RM69.14 million a year earlier.

Earning per share were 9.58 sen compared to 20.37 sen, while net assets per share was RM5,40.

The group attributed the higher production costs to higher fertilizer costs.

In the nine months ended Mar 31, revenue rose 11.28% to RM202.32 million from RM181.81 million and net profit was down 11.17% to RM47.08 million from RM53.00 million.

On its prospects, Glenealy said the outlook for palm oil price remains well supported as palm oil production is expected to slow down as it enters a resting phase.

“Global oilseeds and vegetable oils supplies are at multiyear low due to drought induced production losses over the past few seasons in various countries.

“On the basis of the above factors, the outlook for the fourth quarter of the financial year is expected to remain positive, it said.



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Cuscapi 1Q net profit plunges to RM567,000

KUALA LUMPUR (May10): CUSCAPI BHD []’s net profit plunged 70.92% to RM567,000 for its first quarter ended Mar 31, from RM1.95 million a year ago, dragged down by delays in uncompleted projects.

In a statement on Bursa Malaysia on Thursday, the group said its revenue fell 21.34% to RM12.13 million from RM15.42 million a year earlier.

Earnings per share were 0.23 sen compared to 0.88 sen.

Reviewing its results, Cuscapi attributed the fall in its revenue to an order of over RM4 million for an upgrade project in the same quarter last year.

“However, delays in certain projects compounded the lower revenue during the quarter under review,” it said.

On its prospects, Cuscapi said that with international revenue showing continued growth, making up 38% of the Group’s revenue during the quarter under review, it remained optimistic of its financial performance for the current financial year.

“We expect this trend on the back of the Group’s enlarged geographical presence,” it said.



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Maybank issues RM2.1 billion subordinated notes

KUALA LUMPUR (May10): MALAYAN BANKING BHD [] said it had issued RM2.1 billion of Subordinated Notes with tenure of 12 years on a 12 non-callable 7 basis under its Subordinated Note Programme of up to RM7 billion in nominal value.

The banking group had on Feb 21 this year proposed to establish a subordinated programme of up to RM7 billion in nominal value.

In a filing Thursday, Maybank the Subordinated Notes were priced at 4.25% and would qualify as Tier 2 capital of Maybank subject to compliance with the requirements as specified in the Risk Weighted Capital Adequacy Framework and Capital Adequacy Framework for Islamic Banks (General Requirements and Capital Components) guideline by BNM.

“The net proceeds from the issuance of the Subordinated Notes will be utilised to fund Maybank’s working capital, general banking and other corporate purposes,” it said.



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Infineon invests RM4b in new Kulim wafer fabrication plant

KULIM (May 10): Infineon Technologies (Kulim) Sdn Bhd (Infineon), which specialises in power and logic chips for automotive and industrial power applications, today announced that it will invest RM4 billion in the Kulim Hi-Tech Park here over the next 10 years.

Its vice president Dr Thomas Reisinger said the company's new Kulim 2 wafer fabrication facility, which is under CONSTRUCTION [], is designed to be a state-of-the art manufacturing competence centre for the production of megatrend TECHNOLOGY [] products for the energy efficiency and automotive industries.

Kulim 2, which supports the technological complexity for 200mm wafers, can also produce 300mm wafers if there is market demand, he said.

Announcing the investment at the launch of Kulim 2 here, Reisinger — who is also Infineon Kulim managing director — said the company has invested RM350 million in the facility on a 30,000 sq m site, work on which commenced in August last year and is expected to be completed by the end of this year.

The launch was performed together by Ministry of International Trade and Industry secretary-general Datuk Dr Rebecca Fatima Sta Maria, Dr Reisinger and Infineon AG board member Dr Reinhard Ploss.

Once operational, Kulim 2 will employ 1,000 more staff, 40% of whom will be highly skilled, and production capacity is expected to double. Kulim 1, with a capacity of 120,000 wafers per month, employs 1,500 people.

"The decision to expand our operations in Kulim is a logical choice as it is a designated growth location for us, and is our first front-end wafer fabrication facility in Asia," he added.

Reisinger said the company runs 29 different base technologies and manufactures about 500 products simultaneously.

"We will retain our position at the forefront of the semiconductor industry by increasing the skills and capabilities of our employees and strengthening our innovative power.

"With the completion of Kulim 2, Infineon Technologies Kulim expects growth of more than 10% per annum in the markets we serve," said Reisinger.

He said the company has also complied with global standards while keeping to a zero defect mindset from day one of operations in 2006.

Infineon is the fourth largest foreign investment company in Malaysia. — Bernama



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Limited gains for KLCI

KUALA LUMPUR (May 10): The FBM KLCI reversed its earlier losses and closed higher on Thursday, but the gains were limited in line with the mixed regional markets still weighed by concerns the global economic outlook.

The FBM KLCI rsoe 3.16 points to close at 1,588.06. It had earlier risen to its intra-day high of 1,590.20.

Gainers edged losers by 376 to 358, while 325 counters traded unchanged. Volume was 1.4 billion shares valued at RM1.39 billion.

Asian shares were mixed, as weak Chinese trade data stoked fears of a growth slowdown, further undermining risk appetites already reduced by worries about the health of Spanish banks and deepening political chaos in Greece, according to Reuters.

At the regional markets, Hong Kong’s Hang Seng Index fell 0.51% to 20,227.28, Japan’s Nikkei 225 lost 0.39% to 9,009.65, South Korea’s Kospi was down 0.27% to 1,944.93

Meanwhile, the Shanghai Composite Index added 0.07% to 2,410.23 and Taiwan’s Taiex gained 0.11% to 7,484.01, and Singapore’s Straits Times Index edged up 0.09% to 2,903.60.

On Bursa Malaysia, United PLANTATION []s was the top gainer and added 56 sen to RM26.50, Petronas Gas up 30 sen to RM17.28, Ajinomoto 27 sen to RM4.50, Southern Acids and Aeon Credit gained 24 sen each to RM2.45 and RM11.10, Tradewinds Plantations 12 sen to RM5.89, Hup Seng and AirAsia 11 sen each to RM2.36 and RM3.65, while KrisAssets added 10 sen to RM7.10.

Focus was the most actively traded counter with 146.46 million shares done. The stock gained 1.5 sen to 16 sen.

Other actives included Utopia, Ariantec, Permaju, Naim indah Corp, ManagePay, Astral Supreme and HWGB.

Decliners included BAT, The Store, Panasonic, Tahps, KLK, Aeon, Lafarge Malayan Cement, Dutch Lady, PPB and KESM.



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RAM Ratings: CIMB’s ratings unaffected by proposed acquisition of Philippines’ Bank of Commerce

KUALA LUMPUR (May 10): RAM Ratings said that CIMB Bank Bhd’s proposed acquisition of a 60%-stake in Philippines-based Bank of Commerce (BoC) from San Miguel Corporation had no immediate rating impact on the Bank’s AAA/Stable/P1 ratings.

The rating agency said On Thursday that The RM881 million deal, currently pending regulatory approval, would be entirely financed by CIMB Bank’s internal funds.

“Based on RAM Ratings’ assessment, the proposed acquisition is expected to have minimal impact on the Bank’s key financial indicators.

“CIMB Bank’s overall risk-weighted capital-adequacy ratio is likely to remain above 15% after the acquisition, which is anticipated to be completed sometime this year,” it said in a statement.

RAM Ratings said the proposed acquisition of BoC represented a strategic part of CIMB Group’s regional aspirations.

“BoC is a relatively small bank given its position as the sixteenth-largest commercial bank out of 38 universal and commercial banks in the Philippines; its assets are only equivalent to about 3% of CIMB Bank’s.

“As with all acquisitions, there could be potential challenges along the way, particularly with respect to aligning the best practices and policies of BoC and CIMB Bank. RAM Ratings will continue monitoring the pertinent developments relating to this proposed acquisition,” it said.



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MMHE gains on Maybank IB Research upgrade

KUALA LUMPUR (May 10): Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) shares rose on Thursday after Maybank IB Research upgraded the stock to a Buy with a target price of RM5.70 and said the company's 1Q12 results 2 were on track (25% of Maybank IB's full-year forecast).

MMHE added three sen to RM4.91 in the morning session on Thursday with 486,500 shares traded.

In a note Thursday, the research house said MMHE's yard space had expanded and order book momentum is set to soar in 2H12.

"The improving outlook, coupled with a 44% fall in share price from its peak in 2011, makes MMHE's valuations much more attractive now, in our view.

"MMHE is a direct proxy to Petronas' domestic E&P programs," it said.



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OSK Research downgrades KKB To Sell, cuts fair value to RM1.34

KUALA LUMPUR (May 10): OSK Investment Research has downgraded KKB ENGINEERING BHD [] to a Sell and cut its fair value to RM1.34 from RM2 previously and said the company's 1QFY12 net profit of RM7.7 million (-60.8% y-o-y, +15.1% q-o-q) was 49.5% below its expectations.

The lacklustre performance was primarily due to weaker revenue from the engineering division which saw slower contract replenishment and heightened raw material costs, it said in a note Thursday.

"We think 2012 would be a challenging year in view of global economic and local political uncertainties and hence, we are tweaking down our earnings forecast and FV to RM1.34. We downgrade KKB to Sell," it said.



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KLCI pares down gains at mid-day as Asian equities turn negative

KUALA LUMPUR (May 10): The FBM KLCI rebounded at the mid-day break on Thursday but pared down its gains as some regional markets turned negative.

Asian shares fell on Thursday, as a weak Chinese trade data stoked fears of a growth slowdown, further undermining risk appetites already reduced by worries about the health of Spanish banks and deepening political chaos in Greece, according to Reuters.

The FBM KLCI gained 3.51 points to 1,588.41 at the mid-day break, lifted by select blue chips. It had earlier risen to its intra-morning high of 1,590.20.

Losers edged gainers by 332 to 256, while 309 counters traded unchanged. Volume was 722.32 million shares valued at RM493.12 million.

The ringgit strengthened 0.11% to 3.0681 versus the greenback; crude palm oil futures for the third month delivery rose RM25 per tonne to RM3,349, crude oil fell 37 cents per barrel tp US$96.44 while gold rose US$4.18 an ounce to US$1,593.75.

At the regional markets, Japan’s Nikkei 225 fell 0.11% to 9,035.48, Hong Kong’s Hang Seng Index lost 0.93% to 20,141.90, the Shanghai Composite Index shed 0.18% to 2,404.15, Taiwan’s Taiex was down 0.16% to 7,487.42, South Korea’s Kospi down 0.10% to 1,948.35 and Singapore’s Straits Times Index fell 0.20% to 2,895.11.

ON Bursa Malaysia, BAT was the top gainer in the morning session and rose 36 sen to RM54.74, Petronas Gas added 30 sen to RM17.28, United PLANTATION []s and Ajinomoto were up 24 sen each to RM26.18 and RM4.47, Petronas Dagangan 16 sen to RM19.86, KrisAssets 12 sen to RM7.12, whiel Hup Seng, RHB Capital and GAB added 10 sen each to RM2.35, RM7.43 and RM13.64.

Focus was the most actively traded counter with 103.8 million shares done. The stock rose two sen to 16.5 sen.

Other actives included Utopia, Ariantec, ManagePay, Naim indah Corp, Astral Supreme, SuperComNet and Permaju.

Decliners included Tahps, The Store, Tradewinds, Panasonic, Dutch Lady, Ekovest, Shell, PPB, KESM and Fiamma.



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Petronas's US$20b RAPID project to meet burgeoning demand for energy and petrochemicals

KUALA LUMPUR (May 10): The US$20 billion (RM61.4 billion) refinery and petrochemical integrated development (RAPID) project to be undertaken by Petronas in southern Johor will be timely in meeting burgeoning demand for energy and petrochemical products especially in Asia in the next 20 years.

To be launched by The Sultan of Johor Sultan Ibrahim ibni Almarhum Sultan Iskandar on Sunday, the project would also enhance both Malaysia's and the region's petrochemical industry, attracting investments from world class oil, gas and petrochemical firms.

It would transform southern Johor into a refining and petrochemical centre, complementing existing complexes in Malaysia's eastern corridors and in Singapore.

More importantly, the sprawling 2,000 hectare RAPID complex would also trigger economic activities for Pengerang, creating thousands of jobs in view of the massive spin-offs from ancillary and supporting services.

Petronas chief operating officer Datuk Wan Zulkiflee Wan Ariffin said timely implementation of RAPID would be crucial as global energy demand was set to increase between 38% and 39% in the next 20 years.

"This is the largest complex Petronas would be undertaking, with the refinery, earmarked for commissioning by end-2016, able to refine 300,000 barrels of crude oil per day while petrochemical plants would come on stream in 2017," he told Bernama.

It would be bigger than that of Petronas' Melaka, Kertih and Gebeng complexes combined in a single location.

As far as end products and applications for petrochemicals are concerned, "we take for granted day-to-day living conveniences such as plastics and food wrapping".

"(But) their demand growth would be significant in Asean given its proximity (to Malaysia) and its combined population in excess of 600 million," he said.

Wan Zulkiflee, who is also Petronas executive vice-president for downstream business, said RAPID would be able to meet this demand.

Demographic changes in China and India, including a rising middle-income populace, urbanisation, lifestyle changes plus rising demand from the auto CONSTRUCTION [] and electrical industries, would impact the petrochemical market positively.

RAPID would also be able to meet the government's requirements for higher emission standards for petroleum products to be imposed in the near future.

"We want to be prepared for this,” Wan Zulkiflee said, adding that gasoline and diesel to be produced by RAPID's refinery would meet the Euro 4 and 5 fuel specifications.

The refinery will be designed to process imported crude oil, including Petronas' equity crudes from some of its overseas upstream ventures.

"We can't totally depend on local crude to feed our refinery to meet demand, so diversification of feedstock leads to security of energy supply in the local market," he said.

Other petroleum products from the refinery would include jet fuel, while a naptha cracker would churn out three million tonnes of products such as ethylene, propylene, C4 and C5 olefins to feed the petrochemical plants in the complex.

A stand-alone crude oil refinery would be a tough business, Wan Zulkiflee said, which was why coupling it with a petrochemical complex in an integrated development promised higher economic returns on investment.

More than that, RAPID is not just about a refinery and petrochemical plants, but would create a new industry spawning tremendous spin-offs down the value chain offering opportunities for other companies.

"Like in Kertih, we foresee end-product manufacturers like cable and plastics producers, and even specialty products like vitamins, personal care products and perfumes, to take advantage of the complex's output," he said.

Providing a progress update on the project, he said the detailed feasibility study was completed end-2011 and "we are now in the front end engineering design (FEED) stage while land acquisition has already started".

Concurrently, the national oil corporation was screening potential joint venture partners who can bring in technologies, as well as, expertise in project management, plant operations and marketing to form partnerships for various facilities within RAPID.

The equities that joint venture partners will take in RAPID's various facilities would determine how much they invest in the US$20 billion project, with Petronas expected to take up majority portions. — Bernama



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KKB retreats on weaker 1Q earnings

KUALA LUMPUR (May 10): KKB ENGINEERING BHD []'s shares retreated on Thursday after its net profit for the first quarter ended Mar 31, 2012 fell 60.82% to RM7.71 million from RM19.68 million a year ago,

At 9.40m, KKB fell three sen to RM1.62 with 54,700 shares done.

The company atrributed the fall in earnings to the completion of major projects in 2011 and the absence of new projects for both its CONSTRUCTION [] and steel fabrication divisions.



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Maybank IB Research maintains Buy on Petronas Chemicals, target price RM7.50

KUALA LUMPUR (May 10): Maybank IB Research has maintained its Buy rating on Petronas Chemicas Bhd with a target price of RM7.50 and said the company's 1Q12 results, to be released on the third week of May, was expected to be highly profitable, buoyed by high plant utilization rates of ±85% (1Q11: 83.6%) with no major maintenance shutdowns, and strong product margins.

In a note Thursday, the research house said worldwide manufacturing numbers were strong in 1Q12 which prompted heavy buying for re-stocking and inventory buildup ahead of the traditional maintenance shutdown period of March.

"BUY, with an unchanged TP of MYR7.50 on 12x 2013 PER, the industry's historical mean PER," it said.



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Sime Darby up on mall plan with CapitaMalls

KUALA LUMPUR (May 10): SIME DARBY BHD [] shares rose on Thursday after its unit Sime Darby Property and CapitaMalls Asia Ltd sid they would jointly develop a RM500 million shopping mall in Taman Melawati in the Klang Valley.

At 9.22am, Sime Darby was up four sen to RM9.81 with 65,800 shares done.

In a joint statement Wednesday, the two companies said they had entered into a conditional agreement to form a 50:50 joint venture to develop the mall on a freehold site in Taman Melawati.

Sime Darby up on mall plan with CapitaMalls



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Maybank IB Research upgrades MMHE to Buy, target price RM5.70

KUALA LUMPUR (May 10): Maybank IB Research has upgraded Malaysia Marine and Heavy Engineering Holdings Bhd to a Buy with a target price of RM5.70 and said the company's 1Q12 results 2 were on track (25% of Maybank IB's full-year forecast).

In a note Thursday, the research house said MMHE's yard space had expanded and order book momentum is set to soar in 2H12.

"The improving outlook, coupled with a 44% fall in share price from its peak in 2011, makes MMHE's valuations much more attractive now, in our view.

"MMHE is a direct proxy to PETRONAS' domestic E&P programs," it said.



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GDex up on solid 3Q earnings

KUALA LUMPUR (May 10): GD EXPRESS CARRIER BHD [] shares advanced on Thursday afer its net profit jumped 61.07% for its third quarter ended Mar 31 to RM2.11 million from RM1.31 million a year ago, due to an increase in business volume and growth in its customer base.

At 9.08am, GDex rose three sen to RM1.04 with 8,000 shares done.

In a statement on Bursa Malaysia on Wednesday, it said that its revenue for the quarter increased 24.49% to RM28.77 million from RM23.11 million.

Earnings per share were 0.82 sen compared to 0.51 sen a year ago, while net assets per share was 19 sen.

GDex attributed its strong performance to an increase in both business volume and growth of its customer base.

It added that the completion of a transshipment hub upgrading at the end of its first quarter had also helped support the increased business volume and handling capacity increased almost three fold in its third quarter.



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Europe anxiety drags Asian equities, KLCI falls in early trade

KUALA LUMPUR (May 10): Anxiety over teh uncertainties over the economic and political future of the troubled euro zone weighed on Asian stosks in early trade on Thursday, and equity assets on Bursa Malaysia were not spared either.

The FBM KLCI opened1.34 points lower at 1,583.56, weighed by losses at key blue chips.

Gainers trailed losers by 41 to 49, while 105 counters traded unchanged. Volume was 13.58 million shares valued at RM8.75 million.

Asian shares fell for a sixth straight session on Thursday, with sentiment taking a further hit from mounting worries about the health of Spanish banks while deepening political chaos in Greece seemed to put it at risk of insolvency and a euro exit, according to Reuters.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.1 percent, touching its lowest in nearly four months. Global shares slid for a sixth day while safe-haven U.S. and German government debt rose on Wednesday, it said.

Among the early decliners on Bursa Malaysia were Genting PLANTATION []s, AMMB, PPB, MBF Hodings, Telekom, RHB Capital, Petronas Dagangan, Orient, Kulim and Kumpulan Europlus.



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Stocks to Watch Southern Steel, Sunway, TRC Synergy, Malayan Flour Mills, KKB Engineering, Sime Darby, MMHE

KUALA LUMPUR (May 10): Investor sentiment at Bursa Malaysia on Thursday may remain weak in line with the gloomy sentiment at most global markets, as political uncertainties in Greece and the rising costs of fixing Spain's banks ignited worries that the eurozone's debt crisis was worsening.

The concerns over Europe added to worries about the impact of softer growth in the US on the global economic outlook, causing a broad retreat from risky assets with world shares falling, oil prices down for a sixth straight session and the commodity-linked Australian dollar hitting new lows, according to Reuters.

The market's immediate attention was on Athens where efforts to form a government were expected to fail, putting its ability to meet the terms of its bailout deal in doubt and raising the possibility of Greece being forced out of the euro, it said.

Among the stocks that could be in focus on Thursday are SOUTHERN STEEL BHD [], Sunway Bhd, TRC SYNERGY BHD [], MALAYAN FLOUR MILLS BHD [], KKB ENGINEERING BHD [], SIME DARBY BHD [] and Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE).

Southern Steel has entered into a joint venture (JV) agreement with Belgium-based NV Bekaert SA (NV BK) to form a JV company in Singapore to manufacture specified steel wires in the Asean region. It said in a filing on on Wednesday that it would hold 45% in the JV, with NV BK holding the remaining 55%.

Sunway Bhd's unit Sunway CONSTRUCTION [] Sdn Bhd and TRC Synergy Bhd's subsidiary Trans Resources Corporation Sdn Bhd were among the companies that secured four additional construction packages worth RM3.22 billion for the Sungai Buloh-Kajang MRT.

Sunway Construction was awarded package V4 worth RM1.17 billion, for works between Section 17, Petaling Jaya and the Semantan Portal, while Trans Resources was awarded the Depot package worth RM458.98 million for works related to the Sungai Buloh depot in an open tender category.

Malayan Flour Mills is allocating some RM120 million to expand its flour factory and poultry operations in Malaysia over the next two years. Managing director Teh Wee Chye said the capital expenditure will be financed with the firm's internal funds and bank loans. It has also earmarked US$15 million (RM46.05 million) to expand its two flour factories in Vietnam, he said.

KKB Engineering's net profit for the first quarter ended Mar 31, 2012 fell 60.82% to RM7.71 million from RM19.68 million a year ago, due to the completion of major projects in 2011 and the absence of new projects for both its construction and steel fabrication divisions.

Sime Darby Property and CapitaMalls Asia Ltd will jointly develop a RM500 million shopping mall in Taman Melawati in the Klang Valley. In a joint statement Wednesday, the two companies said they had entered into a conditional agreement to form a 50:50 joint venture to develop the mall on a freehold site in Taman Melawati.

MMHE's net profit for the first quarter ended Mar 31, 2012 fell 39.16% to RM78.27 million from RM128.64 million a year ago, due to the completion of contracts under its engineering and construction arm as well as its marine conversion and repair arm.



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Wednesday 9 May 2012

GDex 3Q net profit jumps 61% to RM2.11m

KUALA LUMPUR (May 9): GD EXPRESS CARRIER BHD []'s (GDeX) net profit jumped 61.07% for its third quarter ended Mar 31 to RM2.11 million from RM1.31 million a year ago, due to an increase in business volume and growth in its customer base.

In a statement on Bursa Malaysia on Wednesday, it said that its revenue for the quarter increased 24.49% to RM28.77 million from RM23.11 million.

Earnings per share were 0.82 sen compared to 0.51 sen a year ago, while net assets per share was 19 sen.

GDex attributed its strong performance to an increase in both business volume and growth of its customer base.

It added that the completion of a transshipment hub upgrading at the end of its first quarter had also helped support the increased business volume and handling capacity increased almost three fold in its third quarter.

The group said it had also adjusted its handling fee since in the previous quarter to cushion the rise it its operating costs, adding that it continues to be cautious in controlling its costs.

In the nine months ended Mar 31, it recorded a 25.31% increase in revenue to RM84.92 million from RM67.77 million a year earlier while net profit rose 39.42% to RM5.80 million from RM4.16 million.



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Frasers Hospitality to manage First Hotel Residence

KUALA LUMPUR (May 9): UOA Development Bhd has engaged Frasers Hospitality Pte Ltd to manage ten premium floors of its 34-storey Camellia Services Suites in Bangsar South.

The 34-storey development in Bangsar South, UOA's flagship mixed use development, will comprise 720 units with an estimated gross development value of RM500 million and is due to be completed by mid-2013.

In a statement Wednesday, UOA Development chief operating officer David Khor said the collaboration was a testament to its strong relationship with Frasers that was built upon mutual trust and admiration for our respective business practices and company cultures.

“It also serves as an ideal platform for both companies to work in synergy by leveraging on each other’s strong brand reputation and expertise to meet the increasing demand for quality hotel residences,” he said.

UOA Development said the ten premium floors comprising 240 units including two exclusive rooftop levels equipped for recreational and business activities would be managed by Frasers under a boutique hotel residence concept, Capri by Fraser.

A key feature of the hotel residence is its creative high-tech chilled out vibe, which will be reflected with its iPad activated check-ins that do away with formal paperwork and interactive e-concierge services to coordinate every aspect of the guest’s stay, from dinner reservations, spa treatments to transport arrangements, it said.

"The opening of the first Capri by Fraser in Malaysia is significant, not only because it further extends our presence in the country but also marks the launch of an exciting new hotel residence concept by Frasers, which reaffirms our confidence in the country’s strong growth potential,” added Fraser chief executive officer Choe Peng Sum.

“With an estimated 2.9 million business travellers projected to enter the country who will contribute US$1.2 billion (RM3.68 billion) in incremental Gross National Income (GNI) 1 by 2020, Malaysia is focused on becoming one of the top five meeting destinations in the Asia Pacific. We are confident that, with our partnership with UOA, we are well positioned to meet the anticipated burgeoning demand for good quality extended stay accommodation,” Choe added.



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KKB Engineering 1Q net profit falls 60% to RM7.71m

KUALA LUMPUR (May 9): KKB ENGINEERING BHD []'s net profit for the first quarter ended Mar 31, 2012 fell 60.82% to RM7.71 million from RM19.68 million a year ago, due to the completion of major projects in 2011 and the absence of new projects for both its CONSTRUCTION [] and steel fabrication divisions.

In a statement on Bursa Malaysia on Wednesday, it said that its revenue for the quarter decreased by 11.71% to RM52.54 million from RM59.51 million a year earlier.

Earnings per share were 2.99 sen compared to 7.63 sen, while net assets per share was 99 sen.

Reviewing its performance, KKB said that although revenue for its construction and steel fabrication divisions dropped 80.9% to RM5.1 million from RM26.8 million, its manufacturing arm managed to offset lower sales of liquified petroleum gas cylinders with strong sales of steel pipes by recording a 211.1% jump in revenue to RM30.8 million from RM9.9 million for the same quarter last year.

"The increased competitive nature of the engineering sector’s businesses coupled with the increasing cost of sales resulting from higher raw material costs have contributed to the lower earnings of the group," it added.



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PetGas posts net profit RM333.46m in 1Q2012

KUALA LUMPUR (May 9): PETRONAS GAS BHD [] (PetGas) posted net profit RM333.46 million for the three months ended March 31, 2012, which was relatively flat year-on-year.

The company said on Wednesday that its revenue for the quarter rose 2.6% of RM23.6 million to RM914.8 million, mainly due to higher utilities sales and gas transportation revenue.

“Profit before tax for the current quarter was RM446.9 million, a decrease of RM17.7 million (3.8%) from the preceding quarter ended 31 December 2011 mainly due to higher other expense resulting from unrealised loss from the revaluation of Currency Exchange Agreement (CEA) and retranslation of term loan,” it said.

Earnings per share was 16.85 sen while net assets per share was RM4.49.

Reviewing it s performance, PetGas said its earnings will remain stable as a result of the fixed fee structure under the Gas Processing and Transmission Agreement (GPTA) with additional earnings potential from performance based structure which is dependent on the level of production of by-products and their prices.

“The completion of the LNG Regasification Terminal in Melaka within the next twelve months will have a positive impact to the group’s earnings in terms of additional income from regasification and transportation services,” it said.

On its outlook, PetGas said prospects for the utilities business will mainly depend on petrochemical customer demand.

“Any variation in gas price will be immediately reflected in the pricing to customers,” it said.



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MMHE 1Q net profit falls 39.16% in 1Q12 to RM78.27m

KUALA LUMPUR (May 9): Malaysia Marine and Heavy Engineering Holdings Bhd (MHB) net profit for the first quarter ended Mar 31, 2012 fell 39.16% to RM78.27 million from RM128.64 million a year ago due to the completion of contracts under its engineering and CONSTRUCTION [] arm as well as its marine conversion and repair arm.

In a statement on Bursa Malaysia on Wednesday, the group said its revenue also decreased 27.95% to RM665.27 million from RM923.29 million a year earlier.

Earnings per share were 4.90 sen compared to 8.00.

MHB attributed the lower earnings to the completion of its engineering, procurement, construction, installation and commissioning (EPCIC) contract in Turkmenistan and its progress on two conversion contracts as well as higher rigs and support vessel repair works secured during the quarter.



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Sime Darby, CapitaMalls to jointly develop RM500m mall in Klang Valley

KUALA LUMPUR (May 9): Sime Darby Property Bhd and CapitaMalls Asia Ltd will jointly develop a RM500 million shopping mall in Taman Melawati in the Klang Valley.

In a joint statement Wednesday, the two companies said they had entered into a conditional agreement to form a 50:50 joint venture to develop the mall on a freehold site in Taman Melawati.

The two companies said the site had an area of about 242,000 sq ft.

"It is located in the centre of Melawati Township and is the last sizeable plot of commercial land in the township," they said.

CapitaMalls and Sime Darby Property said the shopping mall would have a a total net lettable area of about 635,000 sq feet on the site.

"The shopping mall is expected to be completed in 2016, and will serve a catchment population of around 800,000 people within a 10-minute drive," they said.

SIME DARBY BHD [] group chief operating officer Datuk Wahab Maskan, who is also managing director of Sime Darby Property, said the conglomerate was confident that its partnership with CapitaMalls to develop this site in Taman Melawati was the best strategy to maximise the returns on its investment and diversify its income portfolio.

“The synergistic partnership with CapitaMalls provides us the platform to leverage on their experience as the leading shopping mall developer, owner and manager in Asia,” he said.

CapitaMalls chief executive officer Lim Beng Chee said the project marked its first greenfield development in Malaysia.

“It will be the first major shopping mall in the established and affluent residential district of Taman Melawati, and will cater to the under-served retail needs of the residents there as well as the surrounding neighbourhoods.

“It will also provide both Malaysian and international retailers the opportunity to expand their presence to an established residential district in the Klang Valley,” he said.

He said this development would be CapitaMalls’s sixth mall in Malaysia.

CapitaMalls currently owns Queensbay Mall in Penang and — through its stake in CapitaMalls Malaysia Trust — owns Gurney Plaza in Penang, a majority interest in Sungei Wang Plaza in Kuala Lumpur, The Mines in Selangor and East Coast Mall in Kuantan.



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KLCI falls as eurozone woes grip global markets

KUALA LUMPUR (May 9): The FBM KLCI fell on Wednesday as concerns over the economic and political direction of several eurozone countries kept regional and global investors on tenterhooks.

The FBM KLCI lost 5.70 points to close at 1,584.90, weighed down by losses at blue chips.

Losers outpaced gainers by 450 to 273, while 313 counters traded unchanged. Volume was 1.28 billion shares valued at RM1.42 billion.

Asian bourses were mired in the red as Greece struggled to form a government two days after an election, heightening the risk that a hard-won bailout deal could be scrapped, according to Reuters.

Meanwhile, European shares edged lower on Wednesday as a technical rebound from four-month lows was offset by falls among Spanish banks, which were dragged by fears they would be forced to raise money to cover their property assets, said Reuters.

Technical momentum was supportive after key indexes in the US and Europe closed above support levels on Tuesday, sending a bullish short-term signal despite still-depressed market sentiment as a political impasse in Greece threatened to deepen the eurozone crisis, it said.

At the regional markets, the Shanghai Composite Index lost 1.65% to 2,408.59, Japan's Nikkei 225 lost 1.49% to 9,045.06, Taiwan’s Taiex fell 0.93% to 7,475.71, South Korea’s Kospi lost 0.85% to 1,950.29, Hong Kong’s Hang Seng Index shed 0.75% to 20,330.64 and Singapore’s Straits Times Index fell 1.06% to 2,900.91.

On Bursa Malaysia, BAT fell 64 sen to RM55.04, Petronas Dagangan and HLFG lost 24 sen each to RM19.70 and RM11.94, MISC 13 sen to RM4.46, PPB, MMHE and Aeon 12 sen each to RM16.60, RM4.88 and RM9.75 respectively, MSM 11 sen to RM5.20, IJM Corp 10 sen to RM5.44 and BLD PLANTATION []s fell nine sen to RM8.81.

Naim Indah Corp was the most actively traded counter with 80.2 million shares done. The stock was unchanged at 49 sen.

Other actives included Ingenuity Solutions, Metronic, Permaju, Harvest Court, Focus, Ariantec, Astral Supreme and CBSA.

Gainers included Tahps, GCE, GAB, Panasonic, Nadayu, YHS, KGB, Ajinomoto, Tasek and Sunway.



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Sabah expected to receive investment of more than RM1b from American company

KOTA KINABALU (May 9): Sabah is expected to receive an investment of more than RM1 billion from US-based company Dole, in the food and fruits industry.

Sabah Chief Minister Datuk Seri Musa Aman said further discussions are still being held to determine the best method of collaboration with one of the state government agencies.

"They, a major company in the food and fruits industry, have expressed deep interest in a collaboration. We are now seeking a suitable location while determining the form of collaboration with one of the state government agencies," he told reporters after officiating at the Putatan Agricultural Expo here on Wednesday.

Musa said foreign companies were keen to invest in Sabah as it was known as a peaceful state and suitable for investing, compared to some other places.

He also said Sabah had an opportunity to be among the key food producing states based on the cooperation among all parties in this district to drive the agricultural and agro-based industry sector.

"Agricultural expos such as this should be expanded to the other districts throughout the state, so that the potential of the sector can be fully harnessed," he added.

Musa said various and up-to-date information, as well as research findings could be applied through the expo and at the same time, ensure that the sector remains one that contributes to the enhancement of the economy in future.

He said under the five years of the Ninth Malaysia Plan, Sabah's economy had expanded at the rate of 5% annually, with the agricultural sector contributing RM7.24 billion to the 2010 gross domestic product compared to RM3.8 billion in 2005. — Bernama



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CBSA sees 8.33% stake traded off-market

KUALA LUMPUR (May 9): CBSA Bhd saw 20 million shares or an 8.33% stake transacted in several off-market deals at 50 sen each on Wednesday.

The 8.33% stake was based on its paid-up shares of 239.87 million shares.

Yesterday, the share closed at 43.5 sen which means the 50 sen a share paid was traded at 6.5 sen premium.

At 4.15pm, the share gained 0.5 sen to 44 sen with 19.47 million shares done.



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Felda Global bolsters downstream portfolio ahead of IPO

KUALA LUMPUR (May 9): Main Board-bound Felda Global Ventures Holdings Bhd (FGVH) is bolstering its downstream portfolio ahead of its IPO next month with the launch of new consumer branded products.

The group's downstream arm Delima Oil Products Sdn Bhd. -- a subsidiary of FGVH's 49%-owned Felda Global Holdings -- expects over RM1 bilion turnover from newly launched range of bread spread products marketed under SunBear brand, the company said in a statement on Wednesday.

Delima Oil CEO Zakaria Arshad did not gave a time frame for the expected sales but said some RM3 million had been invested in the new products -- peanut butter, peanut spreads and chocolate spreads -- which will soon be available at over 7000 outlets including hypermarkets and supermarkets nationwide. The earmarked amount includes production, advertising and promotion costs.

"The launch of our latest SunBear products is testimony of the company's on-going efforts to add variety to our product offerings beyond cooking oil and palm olein products, in line with consumer needs," Zakaria said in the statement. The group will continue to leverage on its distribution reach and build on its brand value, he added.

Delima Oil's existing porfolio includes Saji cooking oil, the market leader with 27% share of the olein segment, it said. It also produces and markets Tiara and Tiga Udang cooking oil. Other products include Seri Pelangi margarines.

In May last year, Delima Oil introduced four products under the Saji brand: mayonnaise, condensed milk, evaporated milk and instant noodles.



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M'sia's economy to remain stable in 2Q 2012

KUALA LUMPUR (May 9): Based on the latest economic indicators, Malaysia's economy is on a stable foundation and this is expected to continue in the second half of this year, the Dewan Negara was told on Wednesday.

Deputy Finance Minister Datuk Dr Awang Adek Hussein said that between January and February this year, the country's exports rose 7.1% while imports grew 10.2% compared with the same period last year.

"The industrial production index, meanwhile, expanded by 3.8%. In the same period, imports of capital goods recorded a high growth of 32.9% compared with the corresponding period last year.

"In addition, crude palm oil price as at April 25, 2012 was stable at RM3,450 per metric tonne while rubber was at RM10.88 per kilogramme," he said in reply to a question from Senator Tengku Aziz Tunku Ibrahim who asked on the government's level of readiness in facing the eurozone crisis.

Awang Adek said on the same date the KUALA LUMPUR COMPOSITE INDEX [] (KLCI) was at a higher level at 1,579 points against 1,530 points at end-December last year.

He said investors' confidence continued to rise supported by an increase in foreign investments of 12.3% to RM33 billion last year.

"Private investment activities are expected to be active spurred by business opportunities from the implementation of the Economic Transformation Programme and Government Transformation Programme as well as the government's key initiatives to attract investments," he said.

Meanwhile, Deputy Minister of International Trade and Industry Datuk Jacob Dungau Sagan said trade between Malaysia and Myanmar rose to RM2.42 billion last year from RM1.92 billion in 2010.

"Malaysia's exports to Myanmar grew to RM1.71 billion last year compared with RM1.18 billion the year before, while its imports from Myanmar amounted to RM710 million in 2011 and RM730 million in 2010.

"Malaysia's investments in Myanmar totalled US$977.6 million (RM2.99 billion) involving various investments such as CONSTRUCTION [], hotels, petroleum and manufacturing," he said.

Jacob said this in reply to a question from Senator Datuk Chiw Tiang Chai and Senator Datuk Mohammad Najeeb Abdullah who asked on the current status of investments and trade between Malaysia and Myanmar.

He said the government welcomed the changes in Myanmar which had started to practise a more open political and economic policies.

"The Ministry of International Trade and Industry is now actively taking efforts to strengthen bilateral relations as well as explore investment opportunities in Myanmar," he said. — Bernama



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