KUALA LUMPUR (Feb 13): Magnum Bhd saw its net profit for the fourth quarter ended Dec 31, 2014 (4QFY14) expanded 15.87% to RM61.33 million or 4.3 sen a share, due to lower prizes payout in the gaming segment.

Quarterly revenue however, declined by a marginal 1.86% to RM727.41 million, versus 741.20 million in 4QFY13.

Magnum (fundamental: 1.7; valuation: 1.2) declared a fourth Interim Single Tier Dividend of 5% per ordinary share to be paid on March 27, 2015, to shareholders registered on the Register of Depositors on March 12.

For the full year, Magnum's net profit fell 3.93% to RM257.28 million, while revenue weakened to RM2.89 billion, from RM2.99 billion, representing a 3.34% drop.

Commenting on its gaming segment performance, Magnum said the segment's 4QFY14 pre-tax profit has increased by RM10.5 million to RM89.9 million, from RM79.4 million last year, due to lower prizes payout.

However, its investment holdings and others segment recorded a loss of RM4.2 million, as compared to a pre-tax profit of RM4.5 million a year earlier, on relatively higher fair value loss of quoted investments in this quarter, coupled with lower other income, when compared to corresponding previous quarter.

On prospect, Magnum said the Goods and Services Tax (GST) which will come into effect from April 1, coupled with weak consumer sentiment, will have a moderating effect on its sales.

"In addition, the GST expense based on net gaming supplies that will be absorbed by the company, will have an impact on our profitability for the coming financial year.

"To mitigate the above, the company will endeavour to innovate our marketing, product and distribution strategies for all the games," it added.

Magnum dropped two sen or 0.72% to close at RM2.76, giving it a market capitalisation of RM3.96 billion.

(Notes: 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.)