DRB-Hicom, IJM Corp, Wah Seong, UEM Sunrise, Sime Darby, Lafarge, Lion Corp, QL Resources, AirAsia, TM and Maybank

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KUALA LUMPUR (Feb 26): Based on corporate news flow and announcements today, stocks in focus tomorrow (Friday, Feb 27) could include: DRB-Hicom Bhd, IJM Corp Bhd, Wah Seong Corp Bhd (Wah Seong), UEM Sunrise Bhd, Sime Darby Bhd, Lafarge Malaysia Bhd, Lion Corporation Bhd, QL Resources Bhd, AirAsia Bhd, Telekom Malaysia Bhd (TM) and Malayan Banking Bhd.

DRB-Hicom Bhd, the parent company of national carmaker Proton Holdings Bhd, saw its net profit plunged 94% to RM9.47 million or 0.49 sen a share for the third quarter ended Dec 31, 2014, from RM147.66 million or 7.64 sen a share a year earlier.

However, revenue for the quarter rose 6% to RM3.53 billion, from RM3.33 billion previously.

The sharp decline was blamed on higher taxation of RM72.7 million for the quarter, compared to a tax write-back of RM6.1 million in the previous corresponding quarter.

The group declared a single-tier dividend of 1.5 sen a share for the quarter, payable on April 28.

As for its nine months to Dec 31 (9MFY15), net profit fell 29% to RM210.4 million or 10.88 sen per share, despite revenue having climbed 4% to RM10.48 billion.

For the remainder of its financial year, DRB-Hicom said it is “well-positioned to deliver positive results, albeit lower than the previous financial year”.

IJM Corp Bhd (IJM) announced that its wholly-owned subsidiary IJM Construction Sdn Bhd has bagged a RM1.19 billion contract from Kuantan Port Consortium Sdn Bhd, to construct New Deep Water Terminal (NDWT) at Kuantan Port (KPC), Pahang.

IJM’s wholly-owned subsidiary Road Builder (M) Holdings Bhd has a 62% stake in KPC.
 
KPC has a 30 year concession from the government, to operate Kuantan Port. With the development of the NDWT, IJM said it will sign a new privatisation agreement for 30 years, with an option to extend another thirty 30 years.

The group added that it plans to expand the port to cater for ships up to 200,000 deadweight tonnage (DWT), with an expected operation to commence as early as 2016.

Wah Seong Corp Bhd (Wah Seong) saw its profit surge by 67.6% for the fourth quarter ended Dec 31, 2014 (4QFY14), to RM34.56 million or 4.48 sen per share.

Likewise, quarterly revenue rose 43.9% to RM711.53 million, mainly due to higher number of oil and gas (O&G) projects having been implemented.

For the full year, Wah Seong reported net profit had multiplied to RM125.57 million or 16.26 sen per share, from RM32.32 million in FY2013.

Likewise, revenue had increased by 37% to RM2.44 billion, due to new projects in its O&G segment, industrial training and services segment, as well as its renewable energy segment.

Property developer UEM Sunrise Bhd’s (UEM Sunrise) net profit more than tripled to RM272.38 million in the fourth quarter ended Dec 31, 2014, from RM77.96 million a year earlier, bringing its basic earnings per share (EPS) to 6 sen, from 1.79 sen.

Revenue for the quarter soared 134% to RM1.34 billion, from RM573.11 million in the year before.

However, for the full year of 2014, net profit came in 17% lower at RM479.93 million, compared to RM579.14 million in FY13, despite a 10% year-on-year increase in revenue to RM2.66 billion, from RM2.43 billion.

The lower profit was attributed to lower margin from land sales, which was partly offset by higher profit from property development.

According to UEM Sunrise, it will be launching several new projects, including Estuari, Denai Nusantara and Gerbang Nusantara in the southern region, and Serene Heights, Artisan Hills and Sefina in the central region. It will also be launching Conservatory, its second Australian project, in the second half of 2015.

Sime Darby Bhd’s net profit dipped 47% to RM437.4 million in the second quarter ended December 31, 2014 (2QFY15), from RM818.31 million a year earlier. The decrease was due to a dip in its plantation, industrial, automotive and property income.

Sime Darby (fundamental: 1.3, valuation: 1.3) said revenue increased to RM10.74 billion, from RM10.71 billion.

For the six months (1HFY15), Sime Darby recorded a decrease in net profit to RM938.1 million, from RM1.31 billion a year earlier. Revenue fell to RM20.87 million, from RM21.29 million.

Despite a decline in 2QFY15 profit, Sime Darby proposed a dividend of six sen for the quarter under review.

Sime Darby president and group chief executive officer Tan Sri Mohd Bakke Salleh told pressmen today, that 1HFY15 was challenging, due to tough market conditions.

Mohd Bakke said the sharp decline in crude oil prices and global economic growth deceleration, had resulted in the need for greater productivity and cost efficiency.

He also said Sime Darby will defer the listing of its automotive arm to the second half of this year, as the market is “not conducive” for a listing right now.

Lafarge Malaysia Bhd (Lafarge) reported a 30% drop in net profit to RM256 million for financial year ended Dec 31, 2014 (FY14), due to continued price pressures and higher operating costs.

Meanwhile, revenue of the country’s largest cement producer had eased 4% year-on-year to RM2.7 billion.
 
In a press statement, Lafarge said contribution from the concrete segment increased, but revenue from the cement and aggregate divisions declined due to lower cement prices. Meanwhile, operating cost rose due to higher electricity tariff, plant maintenance and higher transport cost.

Steel products manufacturer, Lion Corporation Bhd, saw its net loss widen to RM123.31 million or 9.37 sen a share in its second quarter ended Dec 31, 2014 (2QFY15), from RM33.18 million previously, due to sluggish demand in the domestic steel market.

Revenue in 2QFY15 also decreased 35.42% to RM474.28 million, from RM734.38 million, its filing with Bursa Malaysia showed.

It said sluggish demand in the domestic steel market is due to rampant dumping activities by foreign steel players, which it said remained a major market disturbance.

Lion Corp said pending the effectiveness of the Anti-Dumping Duty measures by the government, the operating environment for its steel business is expected to remain challenging in the coming quarter.

QL Resources Bhd (QL) saw its net profit for its third quarter ended Dec 31, 2014 (3QFY15) increased by 24.7% to RM55.62 million or 4.46 sen per share, from RM44.61 million or 3.89 sen per share in 3QFY14.

This was mainly due to higher contributions from raw material trade and poultry operations from its integrated livestock farming division.

Meanwhile, the poultry farmer reported a 10.1% increase in revenue to RM732.82 million in 3QFY15, from RM665.63 million in 3QFY14, mainly due to overall higher contribution from its marine product manufacturing, namely its surimi-based products, fishmeal operations and new shrimp farming.

Budget airline AirAsia Bhd slipped into the red in its fourth quarter ended Dec 31 2014 (4QFY14), with a net loss of RM428.51 million or 15.4 sen per share, compared to a net profit of RM168.5 million or 6.1 sen per share a year ago, due to foreign exchange (forex) losses and lower net operating profit.

AirAsia (fundamental score: 1.3; valuation score: 1.8) said its net operating profit for 4QFY14 fell 9% to RM109.8 million, due to higher finance costs relating to bank borrowings, as the airline took delivery of new aircraft, as well as to finance its new AirAsia headquarters at klia2 in Sepang.

Revenue however, climbed 15.8% to RM1.48 billion, from RM1.28 billion in 4QFY13, which it said was because of double-digit growth in both average fare and ancillary income per passenger, which increased 13% and 31% year-on-year respectively.

The poor quarterly results dragged AirAsia's net profit for the full financial year ended Dec 31, 2014 (FY14) down 77.1% to RM82.84 million, from RM362.12 million the previous year, despite its revenue climbing 5.9% to RM5.42 billion, from RM5.11 billion in FY13.

Telekom Malaysia Bhd (TM) raked in a net profit of RM218.3 million or 5.9 sen per share in its fourth quarter ended Dec 31, 2014 (4QFY14), down 36.59% from RM344.24 million or 9.62 sen per share in the previous corresponding period, on the back of higher operating costs and taxation.

Its revenue during the quarter under review, however, was up 5.96% on-year to RM3.16 billion, from RM2.98 billion, due to higher contributions from its Internet and multimedia and data services, its filing today with Bursa Malaysia, showed.

Telekom proposed a final dividend of 13.4 sen per share, subject to shareholders' approval at its forthcoming annual general meeting.

For its full FY14, Telekom's net profit was at RM831.81 million, a decline of 17.82% from RM1.01 billion in FY13 — also due to higher operating costs and tax charge — even though revenue came in 5.71% higher at RM11.24 billion, compared to RM10.63 billion previuosly.

Similarly, Telekom said the higher revenue was achieved on the back of higher revenue from Internet and multimedia, data and other telecommunication-related services, which was partially offset by lower contribution from voice and non-telecommunication-related services.

Malayan Banking Bhd’s net profit in the fourth quarter ended Dec 31, 2014 (4QFY14), increased 12% to RM1.93 billion, from RM1.73 billion a year earlier, on higher net interest, Islamic banking and insurance income.

Revenue came in higher at RM9.66 billion versus RM8.27 billion. Maybank said net interest and Islamic banking income increased 2.3%, as conventional and Islamic financing grew.

Net insurance premiums from its conventional and Islamic insurance subsidiaries increased to RM1.02 billion, according to the group.

For the full year, Maybank posted a higher net profit of RM6.72 billion, from RM6.55 billion a year earlier. Revenue rose to RM35.71 billion, from RM33.25 billion.

Maybank plans to reward shareholders with a dividend of 33 sen a share for 4QFY14, bringing full-year dividends to 57 sen.

(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.)