George Kent rises 5.47% on better earnings

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KUALA LUMPUR (July 1): Shares in George Kent Bhd surged as much as 5.47% in the morning trade after the group posted better earnings, following by the group’s target to grow its order book.

As at 2.08pm, the stock had pared some gains and was trading at RM1.34, up six sen or 4.69% from its earlier high of RM1.35, with some 1.94 million shares done.

The current price gives it a market capitalisation of RM402.55 million.

In a filing with Bursa Malaysia yesterday (June 30), George Kent (fundamental: 1.4; valuation: 1.4) said its net profit had risen 53% to RM9.87 million in the first quarter ended April 30, 2015 (1QFY16), from RM6.47 million a year earlier, driven by lower cost at its water meter and construction divisions.

The water related products manufacturer said revenue for the quarter, however, dropped to RM59.03 million, from RM64.86 million a year earlier.

Meanwhile, group chairman Tan Sri Tan Kay Hock told pressmen after the group’s annual general meeting yesterday, that the group's order book stood at slightly over RM1 billion, which could last the company for two years.

He also said the group aimed to grow its order book by between RM2 billion and RM3 billion in FY16, from a tender book of about RM10 billion.

"We are bidding for water and healthcare infrastructure projects, and also railway projects," he had said, adding that the group is also bidding for some of the packages for the Mass Rapid Transit 2 (MRT2) project.

(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.)