Friday, 17 February 2012

Shell Refining posts losses of RM99m in 4Q, RM125m in FY11

KUALA LUMPUR (Feb 17): Shell Refining Company (Federation of Malaysia) Bhd posted losses of RM99.49 million in the fourth quarter ended Dec 31, 2011 and RM125.74 million losses for the financial year 2011, impacted by weak refining margins.

For the 4QFY11, the net losses of RM99.49 million were a stark contrast to the net profit of RM114.66 million a year ago.

“The board explained that the loss was mainly due to weak refining margins and lower production resulting from the statutory turnaround. The weak refining margins were caused by a spike in crude prices as a result of the Japan energy crisis and Middle-east geopolitical turbulent events,” it said on Friday.

Shell Refining said its 4QFY11 revenue was 32.8% higher at RM3.369 billion compared with RM2.537 billion.

However, its cost of sales was RM3.415 billion versus RM2.371 billion a year ago. Loss per share was 33.16 sen compared with earnings per share of 38.22 sen.

It proposed a final dividend of 20 sen per share despite the losses compared with the 30 sen dividend a year ago.

In 4QFY11, the refinery processed 8.6 million barrels of crude oil and sold 9.2 million barrels of product.

It added the CONSTRUCTION [] of a 6,000 tonnes per day diesel processing unit was on schedule and allow it to vary its feedstock options, increase diesel production and improve refining margins.

On the outlook, it said refining margins were expected to be continuously under pressure in 1QFY12. It added its key focus areas were to optimise financial and operational performance, which included ensuring processing flexibility, high plant reliability and commissioning the diesel processing unit upon its anticipated completion in 4QFY12.

For FY11, its net loss was RM125.74 million compared with net profit of RM106.38 million a year ago.

It recorded revenue of RM11.212 billion, an increase of 8% from RM10.376 billion a year ago. However, its cost of sales in FY11 was RM11.310 billion versus RM10.222 billion in FY10.



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AMMB’s Indonesian subsidiary gets investment manager licence

KUALA LUMPUR (Feb 17): AMMB HOLDINGS BHD []’s subsidiary PT AMCI Manajemen Investasi Indonesia (AmInvestasi) has received an investment manager licence to operate the Indonesia.

AMMB said on Friday the Badan Pengawas Pasar Modal dan Lembaga Keuangan (Indonesia Capital Market and Financial Institutions Supervisory Agency) had issued the licence to AmInvestasi on Feb 14.

AmInvestasi is a 99.99% owned subsidiary of PT AmCapital Indonesia, which in turn is 99% owned by AMMB.

AmInvestasi would be able to undertake investment management activities which include portfolio fund management services and also issue and manage mutual fund products.

PT AmCapital Indonesia is involved in stockbroking and underwriting business in Indonesia.



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Listing of Gas Malaysia delayed again to 2Q

KUALA LUMPUR (Feb 17): The listing of Gas Malaysia Bhd on the Main Market of Bursa Malaysia Securities has been delayed again and the listing is now expected to be in the second quarter of 2012.

MMC Corp, which owns 41.8% of Gas Malaysia, said the latter was “still in the midst of complying with the conditions imposed by the Securities Commission” for the proposed listing as stated in the Oct 7, 2011 approval letter.

“Barring any unforeseen circumstances, the proposed listing which was earlier expected to be completed by the first quarter of 2012, is now envisaged to be completed by the second quarter of 2012,” it said.

The Edge Financial Daily reported in November 2011, that the listing, originally planned for the fourth quarter, of that year would likely be postponed to the first quarter of 2012.

According to a previous announcement by MMC, one of the SC’s conditions was Gas Malaysia should ensured that its petrol stations are not built on land that is not designated for the purpose and for the company to rectify any non-compliance within a year of SC’s approval.

Gas Malaysia announced on Oct 19 that it had received the approval from the Economic Planning Unit for its listing, changes in shareholding structure and a proposed issuance of special redeemable preference shares to Petronas.

The company’s IPO comprises 333.84 million ordinary shares of 50 sen each. MMC officials had said the IPO could be set at RM2.20 per share.



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KEuro to buy 15.8% of West Coast Expressway, up stake to 80%

KUALA LUMPUR (Feb 17): KUMPULAN EUROPLUS BHD [] has proposed to raise its stake in West Coast Expressway Sdn Bhd (WCESB) to 80% a move to strengthen its control of WCESB after it secured the RM7.07 billion west coast highway concession.

KEuro said on Friday it was buying a 15% stake or 4.59 million shares of WCESB from Prominent Xtreme Sdn Bhd for RM5.33 million.

KEuro said together with the current 18.649 million shares or 64.20%, the acquisition would see it holding 80% equity interest.

“Upon commencement of the CONSTRUCTION [] of the West Coast Expressway, WCESB is expected to contribute positively to the earnings as well as the shareholders’ value of the KEuro group,” it said.

To recap, on Jan 26, 2012, WCESB received an approval letter from the Public Private Partnership Unit of the Prime Minister’s Department to undertake the proposed privatisation of the construction of the West Coast Expressway.

This would be based on build-operate-transfer (BOT) with a concession period of 60 years, at an estimated project cost of RM7.07 billion.

WCESB’s existing directors are Tan Sri Chan Ah Chye @ Chan Chong Yoon, Datuk Abdul Hamid Mustapha, Datuk David Frederick Wilson, Loy Boon Chen and Datuk Neoh Soon Hiong.

The company has been loss making over the past five years. It posted net losses of RM21,594 in the financial year ended Jan 31, 2011.



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Market Commentary

The FBM KLCI index gained 6.66 points or 0.43% on Friday. The Finance Index increased 0.66% to 13863.47 points, the Properties Index up 0.08% to 1046.78 points and the Plantation Index rose 0.30% to 8821.29 points. The market traded within a range of 6.24 points between an intra-day high of 1559.92 and a low of 1553.68 during the session.

Actively traded stocks include PDZ, COMPUGT, GPA, DIALOG-WA, NICORP, TIGER, EXTOL, PERISAI, GOCEAN and IPOWER. Trading volume increased to 2265.97 mil shares worth RM1941.98 mil as compared to Thursday’s 2185.22 mil shares worth RM1972.18 mil.

Leading Movers were TENAGA (+11 sen to RM6.11), MAYBANK (+6 sen to RM8.56), GENTING (+12 sen to RM10.64), SIME (+5 sen to RM9.59) and PBBANK (+6 sen to RM13.70). Lagging Movers were DIGI (-2 sen to RM4.02), MAXIS (-2 sen to RM5.75), GENM (-1 sen to RM3.95), PPB (-4 sen to RM17.66) and MMHE (-3 sen to RM5.41). Market breadth was positive with 511 gainers as compared to 304 losers. -- JF Apex Securities Bhd



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Sarawak Cable ends MoU for transmission lines plan

KUALA LUMPUR (Feb 17): Sarawak Cable Bhd scrapped the plan to work with Sinohydro Corporation (M) Sdn Bhd and KEC International Ltd to develop transmission lines in Sarawak.

The company said on Friday the memorandum of understanding (MoU) had been terminated and the parties would not be submitting the proposal.

On Aug 17, 2011, the three parties had signed the MoU to prepare and submit proposals for the project.



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Market closes steadier, but down for the week

KUALA LUMPUR (Feb 17): Blue chips on Bursa Malaysia closed firmer on Friday, tracking the regional markets which posted gains of up to 1.6% as investors were somewhat upbeat that Greece had taken enough measures to ensure it would secure a second bailout.

The FBM KLCI closed up 6.66 points to 1,557.17, boosted by gains in Tenaga, Maybank and Genting. Turnover was 2.27 billion shares valued at RM1.94 billion. There were 511 gainers, 304 losers and 346 stocks unchanged.

All the key Asian markets posted gains. Japan’s Nikkei 225 rose 1.58% to 9,384.17, Hong Kong’s Hang Seng Index 1.01% to 21,491.62. Taiwan Taiex 0.32% to 7,894.36 and South Korea’s Kospi 1.30% to 2,023.47 while Singapore’s Straits Times Index edged up 0.79% to 3,000.59. The Shanghai Composite Index was a marginal 0.01% higher at 2,357.18 while the other China indices closed in the red.

Reuters reported optimism grew on Friday that Greece has finally done enough to secure a second bailout despite worsening relations with Germany, but doubts remained over lenders' demands for tighter supervision of how Athens will implement the deal.

Greek officials say they have done everything asked of them for euro zone finance ministers to sign off on the 130 billion euro (US$170 billion) rescue package on Monday -- a month before Athens needs the money to make 14.5 billion euros of debt repayments due on March 20 or go bankrupt.

At Bursa Malaysia, investors were happy to see the market closing higher after the pullback on Thursday. However, for the week, the KLCI lost 4.51 points down from 1,561.66 on Feb 10.

Analysts said the positive economic data from Bank Negara Malaysia on the economic growth in the fourth quarter of 2011 helped boost sentiment. The cautious outlook for 2012, as forecast by BNM, was expected.

Crude palm oil futures for third-month delivery rose RM54 to RM3,243 per tonne. The ringgit gained 0.0162 to 3.0430 to the US dollar.

Tenaga rose 11 sen to RM6.11, pushing the KLCI up 1.41 points. Maybank added six sen to RM8.56 and GENTING BHD [] 12 sen to RM10.64, nudging the index up by 1.06 points and 1.05 points.

HLFG rose 20 sen to RM11.74, Hong Leong Bank 12 sen to RM11.74, Public Bank six sen to RM13.70, AMMB four sen to RM6.14 and CIMB three sen to RM7.28.

Tasek was the top gainer, up 47 sen to RM8.47 after announcing its dividend payout. Petronas Dagangan rose 20 sen to RM18.02 and Petronas Gas 14 sen to RM16.50.

PDZ was the most active with 178.9 million shares done, adding two sen to 10.5 sen, GPA rose 1.5 sen tp 10.5 sen.

Perisai rose six sen to 98.5 sen. There were 50 million shares crossed in several off-market deals at an average price of 88 sen.

Among the decliners were DiGi, down eight sen to RM4.02, Maxis twos en tp RM5.75 and MMHE three sen to RM5.41.



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Perisai sees 5.87% stake crossed off-market

KUALA LUMPUR (Feb 17): Perisai Petroleum Bhd saw 50 million shares crossed in several off-market deals at an average price of 88 sen on Friday.

The 50 million shares represented a 5.87% stake, based on the company’s paid-up of 851.77 million shares.

As at 3.24pm, Perisai shares were up 5.5 sen to 98 sen.

In a recent report, CIMB Equities Research maintained its Outperform recommendation on Perisai with a target price of RM1.45.

The research house said Perisai was set to thrill investors with an anticipated RM10 million to RM12 million net profit for 4Q11, which implied a year-on-year growth of around 55% and a record core net profit of RM35 million for the full year.

“FY11’s 209% core EPS surge will be Perisai’s first earnings growth in four years. We continue to value Perisai at our CY13 target market P/E of 12.6 times. A potentially strong 4Q11 performance, fleet expansion and a prospective marginal field venture support our Outperform call. We have not factored in any contribution from marginal fields,” it said.



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