KUALA LUMPUR (May 19): Based on corporate announcements and news flow today, stocks in focus tomorrow (Wednesday, May 20) could include: Axiata Group, Paramount Corp, Tune Ins Holdings, Jobstreet, Ho Hup Construction, PJ Development, Padini, Sunsuria, AirAsia, Boustead Plantations, Star Publications, Shangri-La Hotels, Econpile and WCT.
Axiata Group Bhd saw its net profit for the first quarter ended March 31, 2015 (1QFY15) fallen 13.3% to RM584.84 million or 6.8 sen per share, from RM674.88 million or 7.9 sen per share a year ago, hampered by losses in its operations in Indonesia, foreign exchange losses and increasing depreciation costs.
Revenue in 1QFY15 however, increased 5.2% to RM4.75 billion, from RM4.51 billion a year ago, driven by strong revenue growth from its business in Bangladesh and Sri Lanka.
“The group’s data revenue continues to grow exceptionally well, with all operating companies posting great traction in the segment. The quarter also saw the group investing more than RM1 billion in capital expenditure, primarily towards strengthening the data network,” Axiata (fundamental: 0.85; valuation: 1.1) said in a statement today.
On outlook, Axiata warns of a challenging performance for the first half ending June 30, 2015 (1HFY15), on competitive pressures and adverse foreign currency fluctuations.
However, Axiata noted it may see improved performance in 2HFY15.
Paramount Corp Bhd’s net profit in the first quarter ended March 31, 2015 (1QFY15) grew 18.5% to RM24.83 million, from RM19.56 million in the previous corresponding quarter, thanks to the higher progressive billing of its property division, which was almost doubled.
Its revenue soared 67% to RM165 million, from the RM98.78 million in the year before.
Despite the higher earnings, its group CEO Jeffrey Chew said 2015 will be a challenging year, due to many different factors which dampen the public’s appetite for the property sector.
He added that the group’s strategy moving forward, will be to make the most of opportunities that the property and education division has to provide.
Chew sees an upside potential in the property sector, as the government is making home ownership more affordable, and improved connectivity is opening up new areas of growth in Greater Klang Valley.
Tune Ins Holdings Bhd’s net profit fell 14.4% to RM16.5 million in the first quarter ended Mar 31, 2015 (1QFY15), from RM19.2 million a year ago, mainly due to a higher base as a result of a one-off gain on disposal of property of RM4.3 million in 1QFY14.
Tune Ins’ (fundamental: 2.7; valuation: 0.35) revenue came in 2.4% lower at RM111.25 million, from RM113.95 million a year earlier.
The insurance provider told Bursa Malaysia today that the lower revenue was due to a decrease of RM4.2 million in gross earned premiums, net off by an increase of RM1.5 million in investment income from collective investment schemes.
On prospects ahead, the group said it is “on track” with its growth strategies across its core businesses of general reinsurance and general insurance.
Jobstreet Corp Bhd saw its net profit increased 86% to RM2.40 million or 0.34 sen a share for the first quarter ended March 31, 2015, from RM1.29 million or 0.20 sen a share a year ago.
The company saw its share of profit from equity accounted associates in 1QFY15, grown by 38.8% year-on-year, mainly driven by its associate in Taiwan whose performance continues to meet expectations.
Jobstreet (fundamental: 1.95; valuation: 2.4) attributed the increase to higher other operating income, interest income and share of profit of equity accounted associates, and partially negated by higher operating expenses.
According to a filing to Bursa Malaysia, quarterly revenue went up marginally by 4.42% to RM590,000, from RM565,000 last year.
Following the disposal of its online job portal business to SEEK Asia in November last year, Jobstreet said the group’s future prospects will depend on the performance of its associated companies in Taiwan and Malaysia, quoted investments in Hong Kong, and operating activities, including Autoworld, in Malaysia.
Ho Hup Construction Co Bhd, which releases a stellar set of quarterly financial result, says it has to be selective in its bidding for infrastructure and construction contracts.
The company acknowledges the influx of foreign construction firms have depressed the construction margin.
On its earnings for the first quarter ended March 31, 2015 (1QFY15), Ho Hup’s (fundamental: 1.7; valuation: 1.2) net profit jumped 77.6% to RM20.09 million, from RM11.31 million a year ago, on strong performance in its property development division.
Quarterly revenue rose 6.7% to RM87.96 million, from RM82.42 million previously.
Ho Hup did not declare any dividend for the quarter.
PJ Development Holdings Bhd saw its net profit dipped 8.71% to RM18.76 million or 4.14 sen per share in the third financial quarter ended March 31, 2015 (3QFY15), from RM20.55 million or 4.54 sen a year ago, on lower contribution from its hotel and leisure division.
Revenue for 3QFY15 rose by a marginal 0.64% to RM229.2 million, from RM227.74 million in 3QFY14, driven by its core construction division.
The construction division registered a pre-tax profit of RM5.8 million for 3QFY15, up by 102% from 2.9 million in 3QFY14.
For the nine months period (9MFY15), the group's net profit rose 7.5% to RM81.58 million or 18.05 sen per share, from RM75.89 million or 16.75 sen per share a year ago; while revenue rose 1. 8% to RM718.07 million, from RM705.5 million.
The group said the construction division is expected to contribute to higher earnings in financial year ending June 30, 2015 (FY15), due to more efficient construction cost management; while the hotel and leisure division is expected to decrease slightly in growth, due to low occupancy rate in the overall hotel industry.
However, it said as a result of bank credit tightening, the take up rate of property sales is expected to slow down.
Padini Holdings Bhd’s net profit grew 26% to RM26.59 million or 4.04 sen per share for its third financial quarter ended March 31, 2015 (3QFY15), from RM21.11 million or 3.21 sen per share a year ago.
The improved earnings were in tandem with a 30% increase in revenue to RM283.62 million, from RM218.85 million in 3QFY14.
Padini declared a fourth interim dividend of 2.5 sen for the year ending June 30, 2015 (FY15), payable on June 22, 2015.
In a filing with Bursa Malaysia today, Padini (fundamental: 2.5; valuation: 1.5) attributed the better revenue for 3QFY15 to the longer Chinese New Year shopping season, while an additional seven Brand Outlet Stores and six Padini Concept Stores had also supported its growth.
For the nine months period (9MFY15), net profit fell 20% to RM62.05 million, from RM77.25 million a year ago; while revenue rose 13% to RM755.96 million, from RM670.25 million in 9MFY14.
Property developer Sunsuria Bhd’s net profit shrunk 36.4% in the financial quarter ended Mar 31, 2015, to RM1.47 million, from RM2.32 million in the corresponding period last year.
Revenue for the quarter was down marginally by 6.5%, from RM22.47 million to RM21.02 million, during the period under review.
As a result, the company’s basic earnings per share (EPS) for the quarter fell to 0.93 sen, from 1.69 sen the previous corresponding quarter.
Sunsuria said higher revenue was contributed mainly by the developments of Trivo — a commercial shop offices project; and Suria Residence — a serviced apartment project, both located in Suria Jelutong.
However, it did not reveal the factors that had caused the fall in its net profit.
For the cumulative period, net profit stood at RM4.45 million, a 24.8% improvement when compared to RM3.56 million achieved last year. Revenue for the cumulative period was RM77.05 million, doubling the corresponding period last year at RM35.46 million.
Budget airline AirAsia Bhd (fundamental: 0.2; valuation: 0.8) denied a news report that it was in talks to sell a minority stake in its loyalty programme joint venture (JV) to private equity firms.
In a statement, AirAsia chief executive officer Aireen Omar said the group is not selling its stake in AirAsia BIG loyalty programme which has over 13 million members, and is growing at a rate of 150,000 new members a month.
"Our AirAsia BIG loyalty programme has tremendous potential for growth — leaps and bounds beyond where it is today,” she said.
“With an expanding range of partners and rewards, driven by an enthusiastic and passionate team, we expect AirAsia BIG to grow their membership to over 20 million in four to five years, so no, we are not selling,” she added.
Boustead Plantations Bhd's net profit sank 75.6% to RM7.35 million or 0.46 sen per share in the first quarter ended March 31, 2015 (1QFY15), from RM30.13 million or 2.95 sen a year ago, due to a decline in fresh fruit bunch (FFB) production and low palm oil prices.
Revenue for 1QFY15 fell 33.6% to RM131.89 million in 1QFY15, from RM198.57 million in 1QFY14.
The group also declared a first interim dividend of 2 sen per share for the financial year ending Dec 31, 2015 (FY15), payable on June 30, 2015.
Boustead Plantations' vice chairman Tan Sri Lodin Wok Kamaruddin said the palm oil industry is impacted by bearish palm product prices and increasing supply of alternative vegetable oils.
“Market conditions continue to be tough. While the year ahead is expected to be challenging due to various pressures, what is important is that the group remains focused on strengthening operational efficiency,” he said in the statement.
In a separate filing, Boustead Plantations announced it is disposing of three parcels of freehold land in Johor for RM48.99 million cash.
The group is selling one piece of land measuring 56.3ha to Seng Hong Quarry Sdn Bhd for RM29.09 million. The other two plots of land measuring a combined 31.97ha are being sold to Bentara Gemilang Industries Sdn Bhd for RM19.9 million.
Boustead Plantations said the disposals are expected to realise an estimated gain of RM38 million after taxation, which translates into a gain of approximately 2.4 sen per share for FY15.
Star Publications (M) Bhd's net profit jumped 63% to RM26.55 million or 3.60 sen a share for the first quarter ended March 31, 2015, against RM16.26 million or 2.20 sen a share a year ago, on higher contribution from its event, exhibition, interior and thematic segment.
However, Star Publication’s (fundamental: 2.5; valuation: 1.4) quarterly revenue went up marginally by barely 3% to RM217.43 million, from RM211.12 million last year.
In a filing to the Bursa Malaysia, Star said revenue for the event, exhibition, interior and thematic segment — consisting of Cityneon and I.Star Ideas Factory — increased to RM38.09 million, from RM30.92 million in 1QFY14, mainly due to higher exhibition and thematic segment revenue recognised by Cityneon in the current quarter under review.
Shangri-La Hotels (M) Bhd’s net profit fell 8.5% to RM25.6 million in the first quarter ended Mar 31, 2015, from RM27.9 million in the previous corresponding quarter.
The hotel and resort group’s revenue declined nearly 12% to RM120.7 million, from RM137.0 million a year earlier.
In an announcement to Bursa Malaysia today, Shangri-La said its overall financial results reflected the reduced operating performances across all its hotels and resorts, due to “significant” decreases in occupancy amid a “weaker business environment”.
The group operates the Shangri-La, Hotel Jen, Rasa Sayang, Golden Sands and Rasa Ria brands in Malaysia.
Econpile Holdings Bhd posted a net profit of RM12.5 million for the third financial quarter ended March 31 — a 128% jump from RM5.5 million in the previous corresponding quarter.
Revenue was also higher as the group reported a 30% increase, from RM87.6 million to RM114.1 million in 3Q15.
In a statement today, Econpile's group chief executive officer Raymond Pang attributed the group’s financial improvement to lower operating expenses and improved efficiency.
He added that the outlook for the company looks bright, in view of the government’s decision to undertake more infrastructure projects such as the MRT 2 and LRT 3.
WCT Holdings Bhd, which earlier planned to set up an estimated RM2 billion real estate investment trust (REIT) this year, may postpone the exercise until next year.
WCT's (fundamental: 0.6; valuation: 2) deputy managing director Goh Chin Liong said the retail-based REIT was "unlikely" to be formed this year (2015), due to cautious market sentiment.
"I don't think it (listing of the REIT) will be this year. Everybody is cautious. We will continue to review it.
But Goh maintained that the REIT plan was still intact. He said WCT would wait for its retail malls to attain operational maturity.
(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)