Scomi advances after Brazil monorail contract finalised

KUALA LUMPUR (Jan 25): SCOMI ENGINEERING BHD [] shares rose on Wednesday after its consortium partners officially sealed the contract with Brazil’s Amazonas state for the RM2.56 billion monorail system.

At 11.10am, Scomi Engineering was up two sen to 62 sen with 439,000 shares done while SCOMI GROUP BHD [] added half a sen to 28.5 sen with 884,500 shares traded.

The Manaus monorail system will include 20 km of monorail line from Largo da Matriz to Jorge Teixeira, nine stations and 10 train sets of six cars each.

The total award is valued at Brazilian Real 1.46 billion (RM2.56 billion) of which Scomi Engineering’s share is Real 339.9 million (RM597.2 million).

The project is expected to be completed in 40 months from the date of the signing of the contract.



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Stocks to watch: Ramunia, Scomi Engineering, MPHB, Silver Bird

KUALA LUMPUR (Jan 23): Stocks on Bursa Malaysia will have to take their cue from the European and US markets in the holiday-shortened trading week, starting on Wednesday.

Trading activity is expected to see lower trading volume as most traders and investors take leave for the Chinese New Year holidays.

In Europe on Monday, fresh signs that a deal may be reached on a Greek debt restructuring, as euro zone finance ministers prepared to decide on acceptable terms for approving further bailout funds.

Reuters reported demand picked up after French Finance Minister Francois Baroin told journalists in Paris that a deal with private sector investors about resolving Greece's debt crisis was taking shape.

However, German Finance Minister Wolfgang Schaeuble, at the same event, said he wanted a second bailout programme for Greece to be in place by March.

Nonetheless, with Bursa Malaysia only reopening on Wednesday, investors would be watching closely the developments unfolding, mainly in Europe on Tuesday.

At Bursa Malaysia, among the stocks to watch include RAMUNIA HOLDINGS BHD [], SCOMI ENGINEERING BHD [], MULTI-PURPOSE HOLDINGS BHD [] (MPHB) and SILVER BIRD GROUP BHD []

Ramunia was given a new lease of life following Bursa Malaysia Securities Bhd’s approval for its proposed regularisation plan which includes a rights issue. The regulator had agreed to the cancellation of 25 sen of the par value of the existing shares of 50 sen each.

Last Friday, the company announced Bursa Securities also agreed to the proposed renounceable rights issue of up to 391.44 million shares of 25 sen each at an indicative price of 40 sen per share on the basis of two for five shares held after the change in par value.

Ramunia said Bursa Securities agreed to the business rejuvenation plan which involved business strategies to build up the group’s order book in relation to major offshore fabrication works as well as other oil and gas related business activities.

Scomi Engineering Bhd’s consortium partners have officially sealed the contract with Brazil’s Amazonas state for the RM2.56 billion monorail system.

The Manaus monorail system will include 20 km of monorail line from Largo da Matriz to Jorge Teixeira, nine stations and 10 train sets of six cars each.

The total award is valued at Brazilian Real 1.46 billion (RM2.56 billion) of which Scomi Engineering’s share is Real 339.9 million (RM597.2 million). The project is expected to be completed in 40 months from the date of the signing of the contract.

The Edge weekly reported in its Jan 23 issue that MPHB is in talks to sell a hotel in Kuala Lumpur for about RM50 million as part of its asset rationalization scheme. MPHB’s unit owns hotels in Penang and in Kuala Lumpur.

Analysts’ expectations are that it could transform into a higher-yielding company. UOB Kay Hian Malaysia Research said MPHB could re-rate in the second half of 2012 as investors start to price in significant divestment and monetisation of its non-gaming assets.

It said MPHB was trading at a steep discount to consensus RNAV of RM3.40 and at a prospective price-to-earnings multiple of 9.9 times on consensus’ forecast.

The Edge also reported that Silver Bird targets to be a global player in the food business as it hopes to leverage on its major shareholder Koperasi Permodalan Felda Malaysia Bhd. Plans are afoot to include other basic food products in various countries, according to Silver Bird group managing director Datuk Jackson Tan.

Positive news from a “win-win” situation for S P Setia Bhd president and chief executive officer Tan Sri Liew Kee Sin and Permodalan Nasional Bhd (PNB) should provide some interest in the property developer.

Under the revised offer announced last Friday, PNB, Liew and S P Setia would also ink a management agreement where Liew would remain as group president and CEO for three years following the close of the revised offer.

S P Setia said PNB agreed, in the three years following the close of the takeover offer, Liew would be given a put option giving him the right to sell his 8% stake to PNB progressively in tranches at the same price of RM3.95 for each S P Setia share, should he desire to do so.

However, trading upside would be capped by the five sen increase in the share and warrants offer prices to RM3.96 and 96 sen under the revised offer.

UMW HOLDINGS BHD [] could see some trading interest after Perodua, in which it holds a substantial stake, allocated RM200.5 million for capital expenditure this year, which includes building its new flagship 3S centres.

Perodua would invest RM30 million to RM40 million for the centre at Section 19, Petaling Jaya, as a model of its future sales and service centre nationwide.



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Scomi Eng JV seals contract with Brazil for RM2.56b monorail

KUALA LUMPUR (Jan 20): SCOMI ENGINEERING BHD []’s consortium partners have officially sealed the contract with Brazil’s Amazonas state for the RM2.56 billion monorail system.

Scomi Engineering said on Friday the consortium -- comprising Scomi Engineering, CR Almeida S/A Engenharia De Obras, Mendes Junior Trading E Engenharia S/A and Serveng-Civilsan S/A Empresas Associadas De Engenharia – had entered into a contract with Amazonas state on Jan 18.

The Manaus monorail system will include 20 km of monorail line from Largo da Matriz to Jorge Teixeira, nine stations and 10 train sets of six cars each.

The total award is valued at Brazilian Real 1.46 billion (RM2.56 billion) of which Scomi Engineering’s share is Real 339.9 million (RM597.2 million). The project is expected to be completed in 40 months from the date of the signing of the contract.



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Scomi, partners ink monorail deal in Brazil

Scomi Engineering Bhd, a unit of Scomi Group Bhd, together with three consortium partners, have signed a contract with the Infrastructure Secretariat of the State of Amazonas in Brazil.

In a statement today, Scomi said the contract involved the development of the detailed engineering design, construction, supply and installation of a monorail system for the Manaus metropolitan region.

"The contract signing follows the successful project award in August last year to the consortium comprising Scomi, CR Almeida S/A Engenharia de Obras, Mendes Junior Trading E Engenharia S/A and Serveng-Civilsan S/A Empresas Associadas de Engenharia.

"The total award is valued at Brazilian Real (BRZ Real) 1.46 billion, or about RM2.56 billion, of which Scomi’s share is valued at BRZ Real 339.9 million, or about RM597.2 million," it said.

Scomi said the monorail will have a capacity to transport 35,000 passengers per hour per direction between Largo da Matriz to Jorge Teixeira urban areas and will benefit over 300,000 commuters daily.

"Under the consortium, Scomi’s scope of works will involve the design and supply of rolling stock and depot equipment, supply of track switches, supply maintenance vehicle, system integration and project management," it said.

Scomi Brazil country president, Hilmy Zaini Zainal, said with the Manaus project, the company will continue to further consolidate its position to provide innovative urban transport solutions in Brazil.

"To be selected by the State of Amazonas as the monorail system supplier for the city of Manaus, also known as the Heart of the Amazon, is a great privilege and testimony to Scomi’s international expertise and capabilities," he said.

Hilmy Zaini said the introduction of the monorail system to this historic city will improve the quality of life for thousands of residents by increasing mobility, reducing congestion, and benefitting the local economy as well as the environment.

"Our investment in local manufacturing is a key component in our project delivery plan and essential for Scomi’s long-term commitment and participation in Brazil’s fast expanding rail market," he said. -- BERNAMA



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KL shares open on strong note

Share prices on Bursa Malaysia were higher in active trading early Friday morning as investors bet on a 2012 bounce, dealers said.

After 10 minutes of trading, the underlying FTSE Bursa Malaysia KLCI (FBM KLCI) stood at 1,510.57, up 3.88 points or 0.26 per cent, led by selected heavyweights especially plantation counters.

It opened 3.98 points higher at 1,510.67.

Market sentiment was also fueled by positive signals out of the US and Asian markets with trading remaining in the positive territory on the last trading day of the year.

HwangDBS Vickers Research said the local bourse could extend its six-day rising streak, which has seen the market chalk up cumulative gains of 41.5 points or 2.9 per cent.

On Bursa Malaysia, the Finance Index gained 13.16 points to 13,436.92, the Plantation Index expanded 23.64 points to 8,111.96 and the Industrial Index added 12.45 points to 2,733.52.

The FTSE Bursa Malaysia Emas Index climbed 24.41 points to 10,372.36, the FTSE Bursa Malaysia Mid 70 Index increased 14.62 points to 11,501.39 and the FTSE Bursa Malaysia Ace Index rose 4.82 points to 4,073.08.

Trading was positive with gainers outnumbering losers 137 to 37 while 120 counters were unchanged, 1,476 untraded and 17 others suspended.

Volume stood at 66.75 million worth RM63.5 million.

Among the active counters, Mulpha was one sen higher at 39.5 sen, LFE Corporation perked 1.5 sen to 21 sen and Scomi Marine added 4.5 sen to 41 sen.

Among the heavyweights, Maybank and CIMB rose one sen each to RM8.33 and RM7.17 respectively, while Sime Darby gained five sen to RM9.05. -- Bernama



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Scomi Engr inks venture pact in Brazil

Scomi Engineering Bhd, a subsidiary of Scomi Group Bhd, has signed a non-binding memorandum of understanding with Montagens e Projetos Especiais SA (MPE) and Brasell Gestão Empresarial, LTDA, to set up a joint-venture company in Brazil.

Scomi Engineering said proposed activities to be undertaken by the joint-venture company include monorail manufacturing and participating in other rail-related projects such as systems supply and installation and other types of rolling stock supply and assembly such as Metro and light rail vehicles.

"Through this partnership with MPE, Scomi will be in a stronger position to capitalise on rail projects, driven by investments to expand and improve urban transport systems in preparation for the FIFA World Cup and the Olympic Games," Scomi Brazil Country president Hilmy Zaini Zainal said in a statement.

With the burgeoning rail market in Brazil, the government is expected to float at least another 20 tenders in the next 24 months for urban transport projects, of which 35 per cent is projected to be monorail systems. Currently, Scomi is involved in two monorail projects in Brazil, with a combined value of RM5.36 billion. -- Bernama



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Scomi Marine Q3 net profit up by 60%

Scomi Marine Bhd, an associate company of Scomi Group Bhd involved in the energy logistics industry, has reported a 60 per cent increase in net profit for the third quarter ended Sept 30, 2011.

In a statement today, the company said it recorded a net profit of RM7.6 million in the third quarter from RM4.7 million in the previous quarter despite a slight drop of revenue by RM1.9 million to RM88 million.

"The higher net profit was achieved through further continuous operational
efficiency initiatives implemented by management that have successfully increased vessel productivity and lower bunker consumption in the coal transportation business.

"The offshore fleet also performed better as utilisation rate improved largely as a result of an increase in exploration and production (E&P) activity mainly in the Malaysian and Indonesian markets," it said.

Despite the increasingly difficult economic environment, the financial outlook for the rest of the year remains positive with the expected increase in E&P activities in the Asian region. -- Bernama



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Scomi climbs on debt revamp plan

Scomi Group Bhd, a Malaysian engineering group, rose to a three-month high in Kuala Lumpur trading after saying it plans to revamp its debt by selling US$100 million of Islamic debt.

It also plans to dispose of some waste management assets for US$35 million.

Its shares climbed 1.7 percent to 30.5 sen at 9:10 a.m. local time, set for their highest close since Aug. 17. -- Bloomberg



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CIMB Research has technical buy on Scomi Group

KUALA LUMPUR (Nov 10): CIMB Equities Research has a technical buy on Scomi Group at 30 sen at which it is trading at a price-to-book value of 0.4 times.

It said on Thursday that Scomi Group tried to break out of its huge descending wedge pattern yesterday but selling pressure was strong.

“This breakout could still take place as long as prices can hold above its moving averages at 28 sen,” it said.

CIMB Research said aggressive traders may buy on weakness with a stop placed below RM0.28. Others should wait for a close above its 200-day SMA before going long. Buying momentum should pick up given the rise in trading volume recently.

“Anything above 28 sen would keep the odds in favour of the bulls. On the upside, prices should re-rate towards 33.5 sen and 36.5 sen to 38 sen next,” it said.

News in brief

Supermax eyes 1-for-1 bonus issue
KUALA LUMPUR: Supermax Corp Bhd has proposed a one-for-one bonus issue and a share buyback scheme.

The company said yesterday the bonus issue will add 340.07 million new shares to its paid-up capital.

It said the proposed share buyback, if implemented, would enable it to utilise its surplus financial resources, which is not immediately required for other uses, to purchase its own shares from the market.

“The proposed share buyback is expected to stabilise the supply and demand, as well as the price of the Supermax shares,” it said.


Scomi to exit US, Mexico, sells US$35m assets
KUALA LUMPUR: Scomi Group Bhd is selling its waste management business in the US and Mexico for US$35 million (RM108.8 million) as it seeks to refocus on Asia.

The company said yesterday the assets would be disposed off to National Oilwell Varco Inc’s subsidiaries. Scomi said it was repositioning itself in Malaysia by increasing its products and services portfolio within the upstream oil and gas industry.


DiGi on track for payback to shareholders
KUALA LUMPUR: Digi.Com Bhd is expected to distribute about RM509 million to its shareholders by the first half of 2012 (1H12) under the proposed capital distribution.

It said yesterday its unit DiGi Telecommunications Sdn Bhd (DiGiTel) had issued 100,000 redeemable preference shares (RPS) to DiGi.

The RPS will be redeemed by DiGiTel on March 7, 2012. Upon redemption of the RPS, DiGi will receive about RM509 million and is expected to distribute such amount (less expenses) to DiGi shareholders by 1H12.


SunREIT 1Q net profit at RM43.86m
KUALA LUMPUR: Sunway Real Estate Investment Trust (SunREIT) posted net profit of RM43.86 million in 1QFY11 ended Sept 30 on revenue of RM95.04 million.

SunREIT proposed an interim income distribution of about 100% of the realisable income amounting to RM47.1 million or 1.75 sen per unit. This amount includes surplus cash arising from 50% manager’s fee payable in units of RM2.7 million.

SunREIT said the revenue was an increase of 31.2% from RM72.44 million a year ago.

“The initial portfolio of eight properties and Sunway Putra Place contributed to the increase by RM14.4 million and RM8.2 million respectively,” it said.

SunREIT said the retail properties from the initial portfolio had contributed an increase of RM9.8 million compared with 1Q11 mainly due to rental revision from Sunway Pyramid Shopping Mall.


This article appeared in The Edge Financial Daily, November 2, 2011.

Scomi sells businesses in Mexico

Scomi Group Bhd is disposing of its drilling waste management assets and businesses to National Oilwell Varco, Inc.'s subsidiaries for RM107.293 million (US$25.035 million).

The business was held by Scomi Oiltools, Inc (Soinc) and Scomi Oiltools De Mexico, S.DE R.L DE C.V (SMEX), both held indirectly via a 76.08 per cent subsidiary, Scomi Oilfield Ltd, Scomi said in a filing to Bursa today.

The bulk of the proceeds from the disposal would be used to repay borrowings.

Scomi said the disposals were in line with its ongoing business strategy to rationalise and streamline existing assets by exiting from volatile markets and to re-focus on Asia, a stable and growing market.

Going forward, the company expects the business strategy to bring in stable earnings.

In addition, Scomi, via Scomi Oilfield, is repositioning itself in Malaysia by increasing its products and services portfolio within the upstream oil and gas industry.

The company expects to capture a share of these markets given the increase in Petroliam Nasional Bhd's oil and gas-related activities in Malaysia. -- Bernama

Scomi Group to exit US, Mexico, sells US$35m assets

KUALA LUMPUR (Nov 1): SCOMI GROUP BHD [] is exiting its business in the US and Mexico following the proposed disposal of its drill waste management assets in those countries for US$35 million (RM107 million) as it seeks to refocus on Asia.

The company said on Tuesday the assets would be disposed of to National Oilwell Varco, Inc’s subsidiaries.

Scomi Group said the proposed disposals are in line with Scomi Group’s ongoing business strategy to rationalise and streamline its existing assets by exiting from volatile markets to re-focus on Asia, a stable and growing market. “Going forward, it is expected that that this business strategy will give stable earnings,” it said.

Scomi Group said it was repositioning itself in Malaysia by increasing its products and services portfolio within the upstream oil and gas industry and is expected to be able to capture a share in these markets given the increase of oil and gas related activities of Petroliam Nasional Bhd in Malaysia.

It said its subsidiary Scomi Oiltools Inc was selling its drilling waste management assets and business for US$25.03 million (RM76.74 million) to National Oilwell Varco, L.P.

Another subsidiary, Scomi Oiltools de Mexicos was selling certain assets used in its drilling waste management business to National Oilwell Varco Solutions S.A. de C.V. for for US$9.96 million (RM30.548 million).

CIMB Research has technical buy on Scomi Group

KUALA LUMPUR: CIMB Equities Research has a technical buy on Scomi Group at 29 sen at which it is trading at a price-to-book value of 0.4 times.

It said on Thursday, Oct 20 Scomi Group is still consolidating in a huge descending wedge pattern.

“Looking at the chart, we think a short term bottom may have formed near the 25 sen low,” it said.

CIMB Research said aggressive traders may start to accumulate now while others should wait for a push above its 200-day SMA before going long. Buying momentum should pick up when prices push above the resistance channel, now at 30.5 sen.

“As long as prices hold on above the 25 sen low, we think the bulls have the upper hand. Once the RM level is taken out, prices should re-rate towards 32.5 sen and 36 sen next,” it said.

Scomi picks Time as sole network provider

KUALA LUMPUR: Scomi Group Bhd (Scomi), a global oilfield services, transport solutions and marine services provider, has appointed TIME dotcom Bhd (TIME) as the sole network provider to meet its global connectivity needs across five countries.

The partnership includes the design, implementation and full management by TIME of Scomi's Private Data Network connecting Scomi's offices in India, Indonesia, United Arab Emirates, United Kingdom and Malaysia.

TIME chief executive officer Afzal Abdul Rahim said the deployment of Scomi's global network solutions is a result of TIME's efforts in building strategic network partnerships, allowing TIME to extend its reach to over 60 countries today.

"As a leading Malaysian multinational, Scomi's trust in our technical capabilities to deliver critical network services for its global operations speaks volumes of our ability to support companies with a global presence.

"This opportunity to work with Scomi comes as an endorsement to our regional expansion strategy. We hope this partnership serves Scomi's business well and will lead to a satisfying long-term working relationship for both companies," said Afzal.

He said TIME's Private Data Network will help facilitate collaboration between Scomi's global project teams and its global headquarters in Malaysia by allowing for faster cross access to shared applications.