KUALA LUMPUR (March 29): Based on corporate announcements and news flow today, stocks in focus on Thursday (March 30) may include: Yen Global Bhd, Paramount Corp Bhd, QL Resources Bhd, Bintai Kinden Corp Bhd, Subur Tiasa Holdings Bhd, Kim Loong Resources Bhd, A-Rank Bhd, Kuantan Flour Mills Bhd, Hai-O Enterprise Bhd, Trive Property Group Bhd and Comintel Corporation Bhd
Lower margins of product mix shipped was the main reason behind the drop in Comintel Corporation Bhd (Comcorp)'s net profit for the fourth quarter of financial year ended Jan 31, 2017 (4QFY17), which fell 17% to RM4.84 million from RM5.85 million in the corresponding quarter a year ago.
It also attributed the weaker earnings to higher losses in its system integration and maintenance service (SIMS) due to a reduction in gross margin due to competition and lower revenue.
Quarterly revenue dropped 2% to RM106.5 million from RM108.8 million a year ago, mainly on the turnover drag in SIMS, which is also due to fewer projects being secured and completed in the current quarter.
However, for the full financial year ended Jan 31, 2017 (FY17), the group’s net profit rose 31% to RM17.6 million from RM13.5 million in FY16, as revenue climbed 8% to RM406.8 million from RM376.7 million.
The improved performance was possible mainly due to higher shipments of products at its manufacturing segment, efficiency improvement to the group’s front-end manufacturing processes, the strengthening of the US dollar, and lower losses from its SIMS segment.
Going forward, Comcorp expects to secure more orders from its customers under the manufacturing segment in the second half of financial year 2018.
Trive Property Group Bhd returned to profitability in the fourth quarter ended Jan 31, 2017 (4QFY17) with a net profit of RM3.28 million, versus a net loss of RM18.52 million a year ago.
Revenue was 16% lower at RM1.27 million from RM1.51 million in 4QFY16, mainly due to lower contribution from its solar division.
For the full year (FY17), Trive property made a net profit of RM2.14 million compared with a net loss of RM26.16 million in FY16. Revenue however was 91% lower at RM3.17 million from RM35.37 million.
The group expects its financial position to significantly improve given the completion of debt restructuring, private placement and ESOS shares issued as well as a full settlement of bank borrowings.
Higher sales pushed up multi-level marketer Hai-O Enterprise Bhd’s net profit by 57% from RM9.78 million to RM15.36 million in the third quarter ended Jan 31, 2017 (3QFY17).
Quarterly revenue improved 33% to RM107.18 million from RM80.52 million previouly, thanks to higher turnover recorded at its multi-level marketing (MLM) and retail divisions.
In its MLM division, Hai-O noted small-ticket consumer products such as food and beverage, personal care, skincare and household products — which generate higher recurring sales — had contributed over 70% to the division's sales in 3QFY17.
As for its retail division, Hai-O said its effective advertising and promotion campaign during the Chinese New Year, along with support from customers’ loyalty programme, had lifted the division's revenue by 13%, in spite of an overall weak consumer sentiment.
As for its wholesale division, Hai-O said although sales from the duty-free market had dropped 9%, pre-tax profit improved by 69% to RM2.5 million, on higher contribution from inter-segment sales.
Hai-O's net profit for the nine months ended Jan 31, 2017 soared 63% to RM41.01 million from RM25.16 million a year ago, supported by a 36% growth in revenue to RM285.62 million from RM209.48 million.
Practice Note 17 (PN17) company Kuantan Flour Mills Bhd (KFM) plans a private placement of 20.46 million shares and a five-for-two rights issue of up to 221.74 million shares to raise up to RM48.44 million for debt repayment and working capital.
The corporate exercises, part of its plan to regularise its financial condition, also involve restructuring its debts owing to creditors.
KFM, which fell under PN17 status in December 2015, said the proposed plan would regularise its financial condition and return to the black while reducing its liabilities and strengthening its cash flow position.
In December 2016, KFM had announced that the Federal Land Consolidation and Rehabilitation Authority (Felcra) was interested in participating in its equity. However, the equity participation failed to materialise.
KFM said the latest plan would be able to revitalise its flour milling business operations, and expand to include the distribution of other flour products such as tapioca starch and corn starch through a business collaboration arrangement with Lotus Essential Sdn Bhd.
The private placement, representing 30% of its total shares, would be taken up by controlling shareholder and director of Lotus, Wong Sak Kuan, and another director, Wong Kim Loong.
KFM said based on the issue price of 20 sen per placement share, the proposed activity would raise RM4.09 million in gross proceeds.
Meanwhile, KFM is proposing to restructure its indebtedness by having 60% of indebtedness waived, 35% of debt settled through the issuance of settlement shares, and the remaining 5% debt in cash.
Following this, KFM expects its total trade and other payables of RM19.31 milion as at Dec 31, 2016 to be reduced to RM6.63 million.
It expects to submit the proposed regularisation plan by end-June with completion expected by the first quarter of 2018.
Aluminium billets producer A-Rank Bhd’s net profit for the second quarter of financial year ended Jan 31, 2017 (2QFY17) increased 10% to RM3.78 million from RM3.42 million, on improved margins.
Revenue for the period however fell by almost the same percentage to RM114.6 million from RM128.1 million. It said the fall in turnover was due to lower business volume, although average selling prices were higher as a result of the increase in raw material costs.
For the first half of the financial year ended Jan 31, 2017 (1HFY17), the Group’s net profit jumped 18% to RM8.44 million from RM7.15 million a year ago, mainly because the decline in operating expenses outpaced the 7% fall in revenue to RM238.4 million from RM255.3 million.
Kim Loong Resources Bhd posted a 36% increase in net profit for its fourth quarter ended Jan 31, 2017 (4QFY17) to RM16.76 million from RM12.36 million, on improved contributions from its plantation operations, driven by better fresh fruit bunch (FFB) prices, despite marginally lower production.
"The plantation operations did not face problems selling its FFB production as most of the produce was supplied to mills within the group," said Kim Loong in a filing with Bursa Malaysia today, adding that the average FFB prices were about 56% higher for the current quarter compared to last year.
Quarterly revenue rose 49% to RM255.99 million from RM172.38 million a year earlier.
The group declared a final single tier dividend of 8 sen per share for the financial year ending Jan 31, 2017 (FY17), which will be paid on Aug 29, bringing its full year payout to 20 sen versus 23 sen in FY16.
For the full year (FY17), however, its net profit dipped 3% to RM71.32 million from RM73.78 million a year ago, though revenue climbed 18% to RM892.59 million from RM757.73 million, primarily because of a 24% drop in profit from its palm oil milling operations due to lower oil extraction rate and lower FFB intake due to competition for the crop in view of lower FFB production.
Going forward, for the financial year ending Jan 31, 2018, Kim Loong expects an increase in FFB production from young mature areas and FFB yield recovery in the Keningau region, where about 50% of the group's planted mature areas are located.
"The group's FFB production could be potentially 20% higher, compared to the quantity achieved in the financial year 2017," said Kim Loong.
Subur Tiasa Holdings Bhd's net loss widened to RM8.84 million in its second quarter ended Jan 31, 2017 (2QFY17) from RM1.81 million a year earlier, on lower contribution from its oil palm segment.
The group reported a 25% drop in revenue to RM121.23 million from RM161.47 million in 2QFY16.
Subur Tiasa reported a bigger net loss of RM8.69 million for the first half of FY17 (1HFY17), compared with RM1.73 million for 1HFY16.
Its half year revenue was down 15% to RM261.98 million from RM306.68 million, primarily due to higher unit logging operational cost resulting from lower volume of logs harvested during the monsoon season.
There was also lower profit contribution from the oil palm segment as a result of lower fresh fruit bunch (FFB) production.
Bintai Kinden Corp Bhd has won a S$14.2 million (RM44.94 million) contract to carry out subcontract works, including maintenance for mechanical and electrical works at the existing Raffles Hotel and Shopping Arcade in Singapore.
Its 69.82%-owned subsidiary Bintai Kindenko Pte Ltd has accepted a letter of award from Sunray Woodcraft Construction Pte Ltd for the project. The subcontract work is estimated to be completed by June 2018.
QL Resources Bhd has disposed of its remaining shareholding of about 38% in QL KK Properties Sdn Bhd for a cash consideration of about RM7.3 million, in line with the group’s strategic review to focus on its core business.
The proposed disposal is an opportunity for QLF to realise the gains from QLF’s investment in QL KK Properties. QL KK Properties is a wholly-owned subsidiary of QL Feedingstuffs Sdn Bhd (QLF), which is wholly-owned by QL Resources.
QLF had on March 17 disposed of about 61.97% equity interest in QL KK Properties to a related party, namely Ruby Technique Sdn Bhd for a cash consideration of RM11.8 million.
The latest announcement saw QLF enter into another share sale agreement with Ruby Tech to further dispose of approximately 38% equity interest or 1.43 million shares in QL KK Properties, for RM7.3 million.
“Upon exercise of the put option, the expected gain arising from the disposal of the balance of the 1,430,000 ordinary shares would be another RM5.827 million. The sales proceeds will be utilised as working capital for the group,” the filing with Bursa said.
Paramount Corp Bhd's wholly-owned subsidiary KDU University College (PG) Sdn Bhd will raise up to RM200 million under a 15-year Islamic medium term notes programme (sukuk ijarah) to fund the development of a new university campus in Penang.
KDU University College issued RM30 million in nominal value of the sukuk today. The sukuk programme was duly lodged with the Securities Commission Malaysia on Feb 14.
The proceeds raised from the Islamic medium term notes issued would be used to finance its RM230 million new campus land and development at Batu Kawan in Seberang Perai Selatan, Penang, and payment of fees and expenses for the sukuk ijarah programme establishment.
It said the sukuk's profit would be based on a fixed rate or floating profit rate basis, and determined prior to the issuance of the sukuk ijarah. "The issue price of the sukuk ijarah would be issued either at par, at a discount or at premium to the nominal value.”
Yen Global Bhd saw its net loss for the second quarter ended Jan 31, 2017 (2QFY17) narrow to RM1.99 million or 1.45 sen per share, from RM2.25 million or 1.81 sen per share a year earlier.
Meanwhile, its 2QFY17 revenue was down 0.16% to RM5.11 million from RM5.19 million a year ago.
The company said the business environment did not see any upturn in sentiment but was sustained by festive sales arising from the Chinese New Year season.
For the cumulative six months of FY17, it registered a lower net loss of RM3.83 million or 2.79 sen a share versus RM3.91 million or 3.14 sen a share a year ago. Meanwhile, its revenue was 1.86% higher at RM11.2 million from RM10.99 million last year.
"Our new venture into the ICT business, specifically in the business of supplying Internet of Things (IoT) connected objects and devices, not only in Malaysia but also in other Asean countries, is projected to start contributing to group results by the next financial year," said Yen Global.