Thai floods dent DRB-Hicom’s earnings, 3Q dn 27%

KUALA LUMPUR (Feb 24): DRB-HICOM BHD []’s net profit took a hit following the severe floods in Thailand, which saw its earnings falling 27.6% for the third quarter ended Dec 31, 2011, to RM79.57 million from RM110.10 million.

It said on Friday that its automotive division’s earnings were affected by the Thai floods which had caused supply constraints.

DRB-Hicom said revenue rose 5.6% to RM1.69 billion from RM1.60 billion a year ago.

Earnings per share were 4.12 sen compared to 5.69 sen. It declared an interim dividend of 2 sen per share for the quarter.

The group attributed supply constraints arising from the recent Thai floods for its lower revenue and profits.

“Nevertheless, DRB-Hicom with its diverse business background is ready to withstand the challenges thrown its way. Its services and property businesses will continue to provide the mitigating factors,” said its group managing director Datuk Seri Mohd Khamil Jamil.

For the nine months ended Dec 31, 2011, revenue dipped 1.01% to RM4.754 billion from RM4.806 billion, while net profits fell 31.3% to RM274.92 million from RM400.07 million.

On the outlook, DRB-Hicom said the group’s automotive sector was expected to be weaker, contributed by new stringent credit financing policies, stiff global and regional competition, volatility of foreign exchange rates and also supply disruptions of components caused primarily by Thailand flood. It expected normal production to resume in March 2012.



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Sarawak Oil Palms FY11 earnings up 60% to RM242m

KUALA LUMPUR (Feb 24): SARAWAK OIL PALMS BHD [] recorded a 60.35% increase in earnings to RM242.95 million in the financial year ended Dec 31, 2011 from RM151.51 million last year, boosted by higher sales and production of crude palm oil (CPO) and palm kernel.

It said on Friday revenue for FY11 increased by 60.7% to RM1.17 billion from RM728.16 million a year ago. Earnings per share were 9.98 sen compared to 10.43 sen.

Sarawak Oil Palms attributed the increase in both revenue and profit to higher production and sales of CPO and palm kernel as well as from trading activities.

For the fourth quarter ended Dec 31, 2011, net profit 11.1% to RM43.32 million from RM48.74 million, due to lower CPO and palm kernel prices compared to a year ago. This was despite a 47.5% increase in revenue to RM313.57 million from RM212.59 million.



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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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Moody’s: TM’s ratings unaffected by RM1.073 bn capital repayment

KUALA LUMPUR (Feb 24): Moody's Investors Service said there was no impact for the A3 issuer and senior unsecured ratings of TELEKOM MALAYSIA BHD [] (TM) after it announced a RM1.073 billion capital repayment to shareholders via a share reduction.

The international ratings agency said on Friday the ratings outlook remains stable.

The proposed capital repayment of about RM1.073 billion would be implemented by reducing the par value of each TM share from RM1 to 70 sen per share. The capital repayment will be funded through TM's existing cash balances of RM4.213 billion as of Dec 31, 2011.

Nidhi Dhruv, a Moody's analyst, and lead analyst for TM said: "The capital repayment is consistent with TM's commitment to periodically return surplus cash to shareholders, in the absence of further capex needs or investment opportunities.

“Although, this will weaken cash flow metrics, TM's overall credit profile remains adequate for its rating level given the cash flow generating capabilities of its core business, manageable capex, and relatively low leverage.”

TM's operational performance for 2011 was in line with expectations, and the company exceeded all its headline KPIs. TM achieved a growth of 12.3% on-year in broadband subscribers, supported by increasing High Speed Broadband (HSBB) take-up of over 20% with 230,000 customers.

In 2011, TM also set up a RM2.0 billion Islamic medium-term notes (IMTN) programme, issuances under which have increased reported total debt to RM6.4 billion as of December 2011, resulting in higher Debt/EBITDA of 1.8 times, compared with 1.6 times a year ago.

"However, the company has no material near-term maturities and benefits from a long-dated debt maturity profile. It can sustain a slightly higher leverage at the current rating level because of the relative stability of cash flow, its dominant market position, largely assured access to domestic capital markets, and expected support from the government of Malaysia,” added Dhruv.

TM is the largest fixed-line telecommunications operator in Malaysia. It holds about 98% of the fixed-line market and 93% of the broadband market (excluding hotspot customers) by subscribers.



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MPHB 4Q earnings double to RM260m, boosted by property sales

KUALA LUMPUR (Feb 24): MULTI-PURPOSE HOLDINGS BHD []’s (MPHB) earnings jumped 205% to RM260.14 million in the fourth quarter ended Dec 31, 2011 (4Q2011) from RM85.21 million a year ago, boosted by an exceptional gain derived from the sale of PROPERTIES [] within the group.

It said on Friday its revenue increased by 2.1% to RM913.91 million from RM894.45 million. Its earnings per share were 20.40 sen compared with 7.90 sen. It declared an interim dividend of 5.0 sen a share.

MPHB said its gaming division recorded a profit before tax of RM84.1 million in 4Q2011, down 6.5% from the profit before tax of RM90.0 million in 4Q10.

The division reported fair value gain on the valuation of derivative of RM1.8 million in 4Q10 compared to a loss of RM1.1 million in 4Q11. Higher operating expenses in 4Q11 had adversely affected the results.

Write back of doubtful debts of RM1.0 million in 4Q10 resulted in higher profit before tax of the stockbroking division at RM5.0 million compared to RM4.0 million recorded in 4Q11.

As for the financial services division, it reported a profit before tax of RM12.5 million which was 30.9% lower than RM18.1 million in 4Q10 due to lower fair value gain from the quoted investments.

For FY11, its earnings rose 60.6% to RM482.02 million from RM300.04 million mainly due to the gain from disposal of properties, higher dividend income from investments and better performances from all divisions. Its revenue dipped 1.6% to RM3.535 billion from RM3.594 billion.



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China Stationery in focus, KLCI closes higher

KUALA LUMPUR (Feb 24): China Stationery Ltd (CSL) was in focus on Friday when it made its debut on Bursa Malaysia on Friday, closing 15.8% higher amid some profit-taking activities in the broader market.

CSL closed up 15 sen to RM1.10 and it was the most active stock with 154 million shares traded.

The stationery manufacturer's initial public offering, priced at 95 sen per share, raised RM85.50 million from its public issue of 90 million new shares.

As for the FBM KLCI, it closed up 2.11 points or 0.14% at 1,558.77, led Axiata (up 6.0 sen to RM5.15), YTL Corp (up 7.0 sen to RM1.49) and IOI Corp (up 6.0 sen to RM5.39). Their gains pushed the index up 3.16 points.

Turnover was 1.70 billion shares valued at RM1.94 billion. Gainers led losers 425 to 373 while 343 counters traded unchanged.

Regional markets closed higher, with the Shanghai Composite Index up 1.25% to 2,439.63, Hong Kong's Hang Seng Index up 0.12% to 21,406.86, Japan's Nikkei 225 0.54% to 9,647.38, South Korea's Kospi rose 0.60% to 2,019.89, Singapore's Straits Index up 0.33% to 2,978.08 and Taiwan's Taiex, up 0.28% to 7,959.34.

Commenting on the performance of Bursa Malaysia, Dr Nazri Khan, vice president of retail research at Affin Investment Bank Research said:

"We see the last three profit taking days (Wednesday to Friday) as a healthy correction to neutralise its overbought momentum.

"We also note that the strong ringgit performance (1.1% weekly gain and 4.5% year to date gain) as positive signs of more inflow for the local equities.”

At Bursa Malaysia, top gainers included British American Tobacco up 44 sen to RM52.56, Panasonic Malaysia up 42 sen to RM21.00 and Dutch Lady up 28 sen to RM25.80.

Losers were led by PLANTATION [] stocks such as BLD Plantation down 39 sen to RM9.51 and United Plantation down 34 sen to RM23.84. Oriental Holdings fell 27 sen to RM6.07, MBM Resources also 27 sen lower at RM4.62 and Genting 26 sen to RM10.46.



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Market Commentary

The FBM KLCI index gained 2.11 points or 0.14% on Friday. The Finance Index fell 0.04% to 13861.51 points, the Properties Index up 0.30% to 1040.31 points and the Plantation Index rose 0.31% to 8630.99 points. The market traded within a range of 6.02 points between an intra-day high of 1559.64 and a low of 1553.62 during the session.

Actively traded stocks include CSL, NICORP, HIBISCS-WA, IFCAMSC, TMS, AXIATA, HARVEST-WA, TIGER, ENVAIR and YTL. Trading volume decreased to 1695.08 mil shares worth RM1941.07 mil as compared to Thursday’s 1951.41 mil shares worth RM2109.15 mil.

Leading Movers were IOICORP (+10 sen to RM5.43), MAYBANK (+7 sen to RM8.77), AXIATA (+6 sen to RM5.15), YTL (+8 sen to RM1.50) and TENAGA (+6 sen to RM6.25). Lagging Movers were GENTING (-26 sen to RM10.46), CIMB (-10 sen to RM7.06), SIME (-3 sen to RM9.60), AMMB (-4 sen to RM6.03) and PBBANK (-2 sen to RM13.66). Market breadth was positive with 425 gainers as compared to 373 losers. -- JF Apex Securities Bhd



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Flash: Maxis 4Q earnings up 47.5% to RM900m, 16c dividends

KUALA LUMPUR (Feb 24): Maxis Bhd’s earnings jumped 47.5% to RM900 million in the fourth quarter ended Dec 31, 2011 from RM610 million a year ago.

The company had on Friday also declared dividends totaling 16 sen per share. It declared a fourth interim single-tier tax exempt dividend of 8.0 sen per share for FY ending Dec 31, 2011 to be paid on March 30. It also proposed a final single-tier tax exempt dividend of 8.0 sen per share for FY11.

Maxis said its 4Q revenue inched up 1.9% to RM2.265 billion from RM2.31 billion. Earnings per share were 12 sen compared with 8.10 sen.

For FY11, it earnings rose 10.1% to RM2.527 billion from RM2.295 billion while revenue dipped 0.7% to RM8.80 billion from RM8.869 billion.



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