Malton’s 2Q earnings down 48% to RM7.18m as projects completed yr ago

KUALA LUMPUR (Feb 24): Property developer MALTON BHD []'s earnings fell 48.3% to RM7.18 million in the second quarter ended Dec 31, 2011 from RM13.90 million a year ago due to the completion of various projects.

It said on Friday, its revenue decreased 28.8% to RM77.74 million from RM109.29 million. Earnings per share were 1.72 sen compared to 3.99 sen a year ago.

Malton attributed the decline in profit and revenue to its Amaya Saujana and Mutiara Indah projects which were being completed.

However, other on-going projects such as Bukit Rimau, V Square, Amaya Maluri and Mutiara Residence contributed positively to its earnings.

For the first half ended Dec 31, 2011, revenue dipped 0.6% to RM177.02 million from RM178.07 million. Net profit fell marginally to 0.8% to RM19.29 million from RM19.45 million.



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Malton profit rises on higher income recognition

KUALA LUMPUR: Property developer Malton Bhd saw its 1QFY12 net profit more than double due to a higher recognition of income from its ongoing projects and the launch of Amaya Maluri.

Net profit for 1Q ended Sept 30 rose to RM12.1 million from RM5.54 million the previous year while revenue improved 44.3% to RM99.2 million from RM68.7 million.

Earnings per share rose to 2.9 sen from 1.59 sen, while net assets per share stood at RM1.33.

The company’s property development segment generated 66% or RM65.7 million in total revenue, followed by construction and project management, and property trading.

Earnings from construction and project management segment improved year-on-year due to progress in external projects.

Malton said its ongoing developments, Amaya Maluri and Bukit Rimau Shops, are expected to contribute positively to its current financial year.

The company proposed a final dividend of 0.85 sen less tax, and a final tax exempt dividend of 1.15 sen per share for its FYE June 30, 2011.

With the completion of the company’s rights issue of RM139.34 million nominal value seven-year 6% redeemable convertible secured loan stocks in early July, the group is expected to save interest costs arising from retirement of borrowings with higher interest rates and enhance its earnings through acquisitions of new land in strategic growth areas such as the Klang Valley, Penang and Johor for future development, it added.

Malton shares eased one sen to 69 sen on heavy volume of 23.43 million shares yesterday.

Early in the day, the stock hit a three-month high of 72.5 sen before easing on profit-taking.


This article appeared in The Edge Financial Daily, November 17, 2011.



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KL shares continue to fall

Share prices on Bursa Malaysia continued their downtrend at mid-afternoon today with persistent profit-taking largely in the country's two largest banking groups, dealers said.

At 3.15pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 2.16 points to 1,474.68, dragged down by losses in Maybank and CIMB, which accounted for a 2.973-point drop in the benchmark index.

The Finance Index dropped 72.79 points to 13,099.14, Plantation Index eased 4.2 points to 7,683.29 and the Industrial Index fell 6.21 points to 2,712.63.

The FBM Mid 70 Index added 6.86 points to 11,042.19 and the FBM ACE Index rose 1.23 points to 4,247.3. The FBM Emas Index, however, fell 6.71 points to 10,113.11.

Advancers led decliners by 333 to 293 while 283 counters were unchanged, 572 untraded and 32 others were suspended. Volume stood at 1.064 billion shares valued at RM666.43 million.

For the actives, Compugates was unchanged at 8 sen but Sumatec Resources rose 4 sen to 18.5 sen while Malton-Warrants edged up 5.5 sen to 39.5 sen.

In heavyweights, CIMB lost 13 sen to RM6.93, Maybank dropped 8 sen to RM8.31 but Sime Darby was unchanged at RM8.93 while Petronas Chemicals added 6 sen to RM6.27. -- Bernama



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Malton climbs on doubling Q1 profit

Malton Bhd, a Malaysian property developer, rose in Kuala Lumpur trading after fiscal first- quarter profit more than doubled to RM12.1 million.

The stock climbed 1.5 percent to 70 sen at 9:02 a.m. local time.


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Stocks to watch: Dialog, Malton, Tanjung Offshore, AMMB

KUALA LUMPUR (Nov 17): Stocks which could see trading interest on Thursday include DIALOG GROUP BHD [], MALTON BHD [], TANJUNG OFFSHORE BHD [], AMMB HOLDINGS BHD [], Amway (Malaysia) Holdings Bhd and ALLIANCE FINANCIAL GROUP BHD [] (AFG) following the release of their financial results for the quarter ended Sept 30.

Dialog posted net profit of RM44.54 million in the first quarter ended Sept 30, 2011, an increase of 34.6% from the RM33.09 million a year, underpinned by a strong increase in revenue, mainly from its New Zealand operations. Its revenue rose 35% to RM355.24 million from RM263.81 million while earnings per share were 2.26 sen compared with 1.69 sen.

Malton’s earnings jumped 118% to RM12.11 million in the first quarter ended Sept 30 from RM5.54 million a year ago, boosted by an improvement in the property development division from a year ago.

Revenue rose 44.3% to RM99.27 million from RM68.78 million while earnings per share were 2.90 sen versus 1.59 sen. Malton said pre-tax profit improved by 111.4% to RM16.7 million from RM7.9 million.

However, Malton's financial performance was slightly weaker compared with the immediate preceding quarter. Revenue declined from the preceding quarter’s RM167.9 million.

Tanjung Offshore Bhd swung into the red with net losses of RM429,000 in the third quarter ended Sept 30, 2011 compared with net profit of RM807,000 a year ago. Its revenue fell 14.3% to RM117.64 million from RM137.25 million a year ago. Loss per share was 0.15 sen compared with earnings per share of 0.29 sen.

For the nine months ended Sept 30, its net profit fell 51.9% to RM3.42 million from RM7.12 million a year ago while revenue was marginally lower at RM401.33 million compared with RM401.95 million. Tanjung Offshore had borrowings totaling RM560.53 million.

AMMB Holdings Bhd’s earnings rose 10.9% to RM369.47 million in the second quarter ended Sept 30,2011 from RM332.87 million a year ago, boosted by the group’s retail banking operations. Its revenue increased by 20.5% to RM2.138 billion from RM1.773 billion while earnings per share were 12.35 sen versus 11.08 sen. It declared a single tier dividend of 6.6% per share.

For the first half, its earnings increased by 15.6% to RM810.99 million while its revenue increased 17.6% to RM4.092 billion from RM3.477 billion.

Amway’s net profit rose 19.8% to RM25.77 million in the third quarter ended Sept 30, 2011 from RM21.51 million a year ago as it benefited from higher sales and improved gross margins due to the favourable foreign exchange impact. Its revenue rose at a slower pace of 5.4% to RM211.52 million from RM191.50 million while earnings per share were 15.68 sen compared with 13.08 sen.

Amway declared a third interim single tier dividend of 9.0 sen net per share and special interim single tier dividend of 30.0 sen net per share for the financial year ending Dec 31, 2011.

AFG reported a strong set of financial results for the second quarter ended Sept 30, 2011, with earnings up 18.2% to RM120.95 million from RM102.27 million a year ago. Revenue increased by 5.9% to RM314.60 million from RM296.98 million. Earnings per share were 7.9 sen compared with 6.7 sen.

For the first half, AFG's earnings rose 8.2% to RM250.51 million from RM213 million while its revenue increased 8.9% to RM624.37 million from RM573.20 million.



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Malton 1Q earnings double to RM12m, boost from on-going projects

KUALA LUMPUR (Nov 16): Malton Bhd’s earnings jumped 118% to RM12.11 million in the first quarter ended Sept 30 from RM5.54 million a year ago, boosted by an improvement in the property development division from a year ago.

It said on Wednesday that revenue rose 44.3% to RM99.27 million from RM68.78 million while earnings per share were 2.90 sen versus 1.59 sen. Malton said pre-tax profit improved by 111.4% to RM16.7 million from RM7.9 million.

“Revenue and profit from the property development division improved as compared to the previous corresponding quarter due to recognition of income from on-going projects with good take-up rates and new launching of Amaya Maluri project during the second quarter of last financial year.

“Total revenue and profit from construction and project management division also improved as compared to the previous corresponding quarter due to construction progress of external projects,” it said.

However, the revenue declined from the preceding quarter’s RM167.9 million. It said the 40.1% decrease was mainly due to lower billings from property development division following the completion of Amaya Saujana project in last financial year and completion of Mutiara Indah Phase 3A, Azures and 48 units shop in Bukit Rimau and near completion of V Square and The Grove projects.

The group recorded a pre-tax profit of RM16.7 million for the current quarter versus RM33.3 million in the immediate preceding quarter.

“The lower pre-tax profit for the current quarter was mainly due to corresponding reduction in revenue in the current quarter as compared to the last quarter,” it said.



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Will focus shift to Malton?

KUALA LUMPUR: The listing of Pavilion REIT, slated for Dec 6, will result in the realisation of a net worth of approximately RM1.69 billion for controlling shareholder Datuk Desmond Lim Siew Choon and his spouse Datin Cindy Tan Kewi Yong. Attention is shifting to Lim’s low profile, undervalued property arm Malton Bhd, as a possible privatisation candidate with the couple now flush with cash.

Lim and Tan will own a collective 37.6% stake in Pavilion REIT upon listing, which is worth RM992.64 million based on a market capitalisation of RM2.64 billion at its initial public offering price of 88 sen.

In addition, the couple will also receive an estimated RM702.7 million in cash from the exercise, which involves the injection of properties into the REIT in return for cash and REIT units.

Pavilion REIT will establish an initial portfolio comprising two properties, Pavilion KL Mall and Pavilion Office Tower, which it will acquire from Urusharta Cemerlang Sdn Bhd (UCSB) and Capital Flagship Sdn Bhd (CFSB) for a total purchase consideration of RM3.32 billion.

The amount will be paid with RM1.378 billion in cash and RM1.944 billion in the form of consideration units in Pavilion REIT.

Lim and Tan, who own 51% of UCSB and CFSB, will receive RM702.7 million in cash from the sale of the properties to Pavilion REIT, as well as 37.6% of the REIT post listing. Qatar Holdings LLC, which holds the remaining 49% in UCSB and CFSB, will hold 36.1% of Pavilion REIT.

These calculations are based on the IPO offer price of 88 sen per unit, which is well below the REIT’s net assets per unit of RM1.18.


Pavillion REIT has a capital base of three billion units and total asset value of RM3.54 billion, according to its prospectus.

With these new funds in hand, certain observers note that it may be an ideal time to privatise Malton Bhd, in which Lim and Tan are controlling shareholders.

Malton’s undervalued position and relatively small market capitalisation may be one factor to support its privatisation.

Malton’s shares surged 8.5 sen or 13.8% to a four-month high of 70 sen yesterday. Trading volume grew over 10 times from 6.81 million shares on Monday to 76.8 million shares yesterday -- its highest level in over a decade. The property company has a market capitalisation of RM292.6 million.

Its five-year high was a mere 83 sen and the stock has consistently traded well below its book value, which stood at RM1.46 on June 30, 2011.

According to Bloomberg estimates, Malton is trading at a low price-earnings ratio (PER) of 2.95 times, compared with the industry average of 8.47 times.

Lim and Tan own 158.4 million shares or a 37.9% stake in Malton and are the only substantial shareholders in the company. The next biggest shareholders are Lee Kim Hooi with 3.47% equity interest and Teras Layar Sdn Bhd with 2.5%.

Buying out the remaining 62.1% stake would cost the couple an estimated RM181.7 million at yesterday’s closing price.

That is equivalent to just a quarter of the cash proceeds they will receive from the Pavilion REIT IPO.

Malton is a niche developer with pockets of land in Puchong, Petaling Jaya, Subang, Sungei Buloh and Ulu Klang in Selangor. It is best known as the developer of the Bukit Rimau township in Shah Alam.

As at June 30, 2011, Malton had RM960.4 million in total assets including RM219.8 million in land held for property development and RM76.09 million in investment properties.

It is in a net cash position, with RM224.42 million in gross cash and RM115.18 million in borrowings.

The company saw its 4QFY11 net profit quadruple to RM26.8 million from RM5.54 million in the previous year, as revenue for the quarter rose 95.2% to RM167.9 million from RM86.02 million.

It saw higher earnings from its property development division, which contributed 84% of total revenue, due to higher revenue recognition from the advanced stages of construction of ongoing projects and projects launched during the year.

Malton has seen a marked improvement in its financial performance in recent years.

Its net profit grew to RM72.6 million in FY11 ended June from a net loss of RM4.6 million in FY08, while revenue rose to RM462.3 million from RM394.8 million over the same period. Its earnings per share rose to 20.86 sen in FY11 from 6.33 sen the previous year.

Most recently, Malton said it had acquired a 56.05-acre piece of land in Gombak, Selangor, for RM105 million for a proposed residential development with an estimated gross development value of RM500 million.

Pavilion REIT, meanwhile, is aiming to raise RM659.2 million from its IPO, the bulk of which will go toward paying the purchase consideration for the acquisition of the two Pavilion buildings.

The company registered RM291 million in revenue last year and a net property income of RM203 million.

CEO Philip Ho said the company projects revenue of RM314 million and net property income of RM220 million from the current financial year, a growth of 7.9% and 8.3% respectively.

“We are very confident, and the forecast figures are achievable as tourist numbers have improved and the market is resilient,” said Ho.

The company targets to inject more retail properties into its portfolio by 2015.

It has right of first refusal (ROFR) to Fahrenheit88, a three-floor retail building fronting the Pavilion Mall.

“I believe Fahrenheit88 just opened its doors late last year. We are waiting for the mall to mature a little bit and then we will evaluate the situation, maybe in 18 to 24 months,” Ho told the media.

It also has ROFR to an extension of Pavilion Mall, involving 30,000 sq ft of retail space, and a six-storey retail mall to be developed in Subang.


This article appeared in The Edge Financial Daily, November 16, 2011.



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Malton buys Gombak land for residential project

KUALA LUMPUR: Property developer Malton Bhd has acquired a 56.05-acres parcel of land in Gombak, Selangor, for a total consideration of RM105 million (RM43 per sq ft) for a proposed residential development with an estimated gross development value (GDV) of RM500 million.

The company said its wholly-owned subsidiary, Gapadu Harta Sdn Bhd, entered into a sale and purchase agreement on Nov 10 to acquire the land from Ukay Spring Development Sdn Bhd (USDSB). The land will be developed by a joint venture comprising Gapadu Harta, USDSB and Liong Kok Wah.

Malton said the total purchase consideration will be fulfilled with a RM9.03 million deposit to be submitted upon the purchase of the land and a payment of RM36.7 million under the joint venture.

Another RM14.4 million will be satisfied in cash while the remaining RM44.7 million will be paid by way of contra with Malton’s existing properties based on the sale price.

It said the acquisition may be financed by internally-generated funds or bank borrowings, or a combination of the two.

“The acquisition, which will increase the landbank for development, is in line with the expansion plan of the core business activities of the Malton group, which are property development and construction,” Malton said in an announcement to Bursa Malaysia yesterday.

It added that the acquisition is expected to contribute to its medium- and long-term profitability and growth.

The acquisition, which is expected to be completed within FY12 ending June 30, will not have any material impact on its earnings per share and net assets per share for the current financial year. It is not subject to the approval of the company’s shareholders, added Malton.

It said the proposed development comprises residential bungalows, semi-detached houses, medium-cost, low-medium-cost and low-cost apartments.

The company said the proposed development is in the initial stages of planning and commencement is still subject to approval from the relevant authorities.

It added that revenue from the development would be dependent on the level of economic growth, development in the vicinity, interest rates and the marketability of the development, as well as its accessibility.

The land is situated in a maturing residential area with established neighbourhood such as Ukay Perdana, Taman Zooview, 20trees, Taman Melawati, Wangsa Maju and Taman Setiawangsa.

Malton sat on a cash pile of RM207.1 million as at June 30, with RM115.1 million in bank borrowings.

For its 4QFY11 ended June 30, net profit more than quadrupled to RM26.8 million from RM5.54 million the previous year. Revenue for the quarter rose 95.2% to RM167.9 million from RM86.02 million.

“The group’s improved earnings were largely due to contributions from the group’s property division, which achieved higher sales and better margins from its development projects and continuous cost savings, and re-engineering exercise carried out by the group,” said Malton.

Revenue from its property development division rose from the year before due to higher revenue recognition from the advanced stages of construction of ongoing projects and new projects launched during the year.

Malton shares remained at 61.5 sen with 6.81 million shares traded yesterday. The stock has lost 15.7% year-to-date.


This article appeared in The Edge Financial Daily, November 15, 2011.



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KL shares easier at mid-afternoon

Share prices on Bursa Malaysia remained easier at midafternoon today as investors were reluctant to take heavy positions on the back of bearish market sentiment following the European debt crisis, dealers said.

At 3.06pm, the FBM KLCI slipped 1.54 points to 1,477.33 with the market barometer moving between 1,473.71 and 1,478.75.

The Finance Index declined 22.79 points to 13,150.61, the Plantation Index dropped 16.32 points to 7,630.06 while the Industrial Index rose 1.07 points to 2,707.88.

The FBM Emas Index slipped 4.18 points to 10,119.2 but the FBM Mid 70 Index improved 26.529 points to 11,002.51 while the FBM ACE Index lost 57.21 points to 4,282.94.

Decliners led advancers by 419 to 302 while 251 counters were unchanged, 509 untraded and 20 others suspended.

Turnover stood at 2.042 billion shares worth RM905.037 million.

Among active stocks, Tiger Synergy edged up 1.5 sen to 15 sen but DPS Resources shed 0.5 sen to 30.5 sen while Malton gained 10 sen to 71.5 sen. Maybank added 1 sen to RM8.26, Sime Darby was unchanged at RM8.91, CIMB eased 5 sen to RM7.13 and Petronas Chemicals shed 3 sen to RM6.41. -- Bernama



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Malton active, up on residential project plan

KUALA LUMPUR (Nov 15): MALTON BHD [] shares advanced on Tuesday, Nov 15 after the company on Monday said it was buying 56.05 acres of land in Ulu Kelang for a residential project with an estimated gross development value of RM500 million.

At 2.40pm, Malton was up 7.5 sen to 69 sen with 39.7 million shares traded.

In a filing to Bursa Malaysia Securities Bhd on Monday, Nov 14, Malton said that its wholly owned subsidiary Gapadu Harta Sdn Bhd had entered into a sale and purchase agreement with Ukay Spring Development Sdn Bhd to acquire the land for RM105 million.

The company said the proposed development would comprise residential bungalows, semi-detached houses, medium cost apartments, low medium cost apartments and low cost apartments with an estimated gross development value of RM500 million.

It said the land was located in a maturing residential area with established neighbouring developments such as Ukay Perdana, Taman Zooview, 20trees, Taman Melawati, Wangsa Maju and Taman Setiawangsa and its accessibility to various major highways such as the Kuala Lumpur Middle Ring Road 2, Duke Expressway and Ampang-Kuala Lumpur Elevated Highway was also taken into consideration.

Malton said the acquisition would be financed by internal generated funds and/or bank borrowings.



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Stocks to watch: Maybank, Malton, SYF, DPS, Flonic

KUALA LUMPUR (Nov 15): The FBM KLCI may come under some pressure to sustain its gains on Tuesday as the uncertainties in Europe pushed Wall street lower while at Bursa Malaysia, stocks which ran up in active trade and volume recently could see a pullback.

In a stern warning to speculators, Bursa Malaysia Securities declared the securities of Harvest Court Industries as designated counters with effect from Nov 15, Wednesday, due to excessive speculation. It said in a statement late Monday the imposition of this ruling will be under further notice. This will be for the shares and the warrants.

In US, stocks fell on Monday as rising bond yields in Italy and other euro-zone countries reminded investors that despite changes in governments, the region's debt crisis could still spin out of control.

The Dow Jones industrial average dropped 74.70 points, or 0.61 percent, at 12,078.98. The Standard & Poor's 500 Index fell 12.07 points, or 0.96 percent, at 1,251.78. The Nasdaq Composite Index lost 21.53 points, or 0.80 percent, at 2,657.22.

On Bursa Malaysia, stocks with fresh corporate developments and could be in focus include MALAYAN BANKING BHD [], MALTON BHD [] and SYF Resources.

Maybank’s net profit for the three months ended Sept 30, 2011 rose 25.1% to RM1.286 billion from RM1.028 billion a year earlier, while its revenue for the quarter rose to RM6.07 billion from RM5 billion in 2010. Earnings per share were 17.20 sen compared to 14.53 sen in 2010, while net asset per share was RM4.41.

On its outlook, Maybank said the loans growth in Malaysia was expected to be mainly driven by the rollout of the Economic Transformation Programme projects and domestic consumption.

Meanwhile, Malton is acquiring 56.05 acres in Ulu Kelang for RM105 million for a residential project with an estimated gross development value of RM500 million.

Malton’s unit Gapadu Harta Sdn Bhd had entered into a sale and purchase agreement with Ukay Spring Development Sdn Bhd to acquire the land. The proposed development would comprise residential bungalows, semi-detached houses, medium cost apartments, low medium cost apartments and low cost apartments.

SYF Resources is in the final stage of negotiation to develop PROPERTIES [] on a joint venture (JV) basis, which it said may have accounted for the unusual market activity (UMA) involving its securities on Monday. The company had in a reply to an UMA query from Bursa Malaysia Securities Bhd said the landowners it was in talks with were mainly related parties.

It said on Nov 14 that details of the JV would be released immediately upon conclusion of the negotiations and the execution of the JV agreement.

Other stocks that could be in focus include DPS RESOURCES BHD [] and FLONIC HI-TEC BHD [] that were also queried by Bursa Malaysia over the sharp price increase in the companies’ respective shares and high trading volume.



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Malton buys land for RM105m, projected GDV of RM500m

KUALA LUMPUR (Nov 14): MALTON BHD [] is acquiring land measuring 56.05 acres in Ulu Kelang for RM105 million for a residential project with an estimated gross development value of RM500 million.

In a filing to Bursa Malaysia Securities Bhd on Monday, Nov 14, Malton said that its wholly owned subsidiary Gapadu Harta Sdn Bhd had entered into a sale and purchase agreement with Ukay Spring Development Sdn Bhd to acquire the land.

It said the land was located in a maturing residential area with established neighbouring developments such as Ukay Perdana, Taman Zooview, 20trees, Taman Melawati, Wangsa Maju and Taman Setiawangsa and its accessibility to various major highways such as the Kuala Lumpur Middle Ring Road 2, Duke Expressway and Ampang-Kuala Lumpur Elevated Highway was also taken into consideration.

Malton said the acquisition would be financed by internal generated funds and/or bank borrowings.

The company said the proposed development would comprise residential bungalows, semi-detached houses, medium cost apartments, low medium cost apartments and low cost apartments with an estimated gross development value of RM500 million.

“The acquisition, which will increase the land bank for development, is in line with the expansion plan of the core business activities of Malton Group (“Malton and its subsidiaries”) which are property development and CONSTRUCTION [].

“The Acquisition is expected to contribute to the medium and long term profitability and growth of Malton group,” it said.



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CIMB Research has technical sell on Malton

KUALA LUMPUR: CIMB Equities Research has a technical sell on Malton at 58 sen at which it is trading at a price-to-book value of 0.4 times.

It said on Monday, Oct 24 the rebound from its 39 sen low may have exhausted.

“Prices went close to challenge the 61.8% FR level but the bears were strong here. As a result, the candles have fallen back below its 200-day SMA,” it said.

CIMB Research said if it is right, the stock is consolidating in a bearish flag pattern. This is usually a downtrend continuation pattern. Hence, any rebound towards 60 sen to 62 sen may be a good opportunity to take profit.

“Technical landscape is showing signs of exhaustion. MACD signal line is poised for a negative crossover while RSI has hooked downward. Support is seen at 55 sen and 50.5 sen. Put a buy stop at 62.5 sen,” it said.