Genting 4Q net profit drops 42.4%, proposes 3 sen dividend

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KUALA LUMPUR (Feb 26): Genting Bhd (Genting) registered a 42.4% drop in its net profit for the fourth quarter ended Dec 31, 2014 (4QFY14) to RM273.84 million or 7.37 sen per share, from RM483.83 million or 13.1 sen per share a year ago, following a net fair value loss on derivative financial instruments and impairment losses and Genting Malaysia Bhd's project costs written off in relation to the unsuccessful application for new licenses in New York, US.

Its revenue for the quarter under review, however, had increased 4.9% to RM4.62 billion from RM4.4 billion in 4QFY13, primarily from better revenue contribution from its Indonesian plantation (on stronger crop production) and its power division (mainly from the construction revenue of the 660MW coal-fired Banten Plant in Indonesia) its filing to Bursa Malaysia today showed.

Genting (fundamental: 2.1; valuation: 0.6) proposed a dividend of 3 sen for the quarter, bringing the total for the year to 4 sen. This is a dramatic plunge from the 50 sen dividend declared in FY13.

For the whole 12-month period ended Dec 31, 2014 (FY2014), net profit was also 17.34% lower at RM1.49 billion or 40.27 sen per share, compared to RM1.81 billion or 48.99 sen per sharelast year, which it said was similarly due to the net fair value loss on derivative financial instruments, impairment losses and Genting Malaysia's project costs written off, which was partially offset by a higher gain on disposal of available-for-sale financial assets.

Revenue for FY2014 came in at RM18.22 billion, representing a 6.5% growth from RM17.11 billion last year, primarily due to higher contributions from its leisure and hospitality business in the US and Bahamas, its plantation division (again on stronger crop production from its Indonesian plantation), higher revenue from its power division (the Banten Plant), and its property division, which came from higher land sales and continued demand for new property offerings.

Earnings per share (EPS) for the quarter is almost halved to 7.37 sen from 13.1 sen during the same period last year. Meanwhile, EPS for the whole year period is 40.27 sen compared to 48.99 sen last year.

(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.)