KUALA LUMPUR (May 9): Based on corporate announcements and news flow today, companies that may be in focus tomorrow (Tuesday, May 10) could include the following: IOI Corp, PetChem, Shell Refining, MISC, Eduspec, Inix, Bison and AirAsia.
IOI Corporation Bhd has filed for a challenge proceeding with the Justice of Peace (JP) in Zurich, Switzerland, against the decision by the Roundtable for Sustainable Palm Oil (RSPO) Board of Governors to suspend the company's RSPO certificates.
In a filing with Bursa Malaysia today, IOI Corp said a conciliatory hearing will be held before the JP, who will mediate between both parties. If the parties are unable to reach an agreement, the JP will grant IOI authorisation to proceed with a formal legal action against RSPO, to be filed at the District Court in Zurich, the filing stated.
IOI Corp's RSPO certificates were suspended in April following a complaint from Aid Environment on April 3 last year regarding its plantation subsidiaries in Indonesia — PT Sukses Karya Sawit, PT Berkat Nabati Sawit and PT Bumi Sawit Sejahtera — for allegedly violating several RSPO principles and criteria.
Petronas Chemicals Group Bhd's (PetChem) net profit was pulled down by 2.1% to RM592 million or seven sen per share due to higher tax expense in the first quarter ended March 31, 2016 (1QFY16) from RM605 million or eight sen per share a year ago.
In a filing to the local exchange today, PetChem said tax expense in 1QFY15 was lower due to the higher recognition of deferred tax asset, mainly on pre-operating expenses pertaining to the Sabah Ammonia and Urea (Samur) project.
Revenue rose by a marginal 0.22% to RM3.15 billion from RM3.14 billion, on higher sales volume and stronger US dollar which offset the impact of lower average product prices.
PetChem managing director and chief executive officer Datuk Sazali Hamzah said 1QFY16's Brent crude oil price average of US$34 a barrel in 1QFY16 compared with US$52 per barrel brought an impact to petrochemical product prices.
Moving forward, Sazali said the outlook for 2016 remains soft.
"PetChem will maintain its focus on operational and commercial efficiencies, as well as effective delivery of growth projects in order to continue bringing value to our customers and shareholders," he added.
Shell Refining Co (Federation of Malaya) Bhd's net profit increased 20.68% to RM101.65 million or 33.88 sen a share in the first quarter ended March 31, 2016 (1QFY16) against RM84.23 million or 28.08 sen a share last year, mainly due to higher margins and lower operating expenses.
This is despite 1QFY16's revenue declining 24.62% to RM1.87 billion from RM2.48 billion in the same corresponding quarter last year, mainly dragged down by lower product prices and sales volumes, according to Shell's filing to Bursa Malaysia today.
The refinery processed 10.2 million barrels of crude oil in 1QFY16, up 7% compared to 1QFY15. However, sales were 1% lower in 1QFY16, with 10.4 million barrels compared to 10.5 million barrels in 1QFY15.
Moving forward, Shell said, "The outlook for refining margins remains uncertain for 2016 as margins will be influenced by international supply and demand for petroleum products, as well as seasonal and cyclical factors."
MISC Bhd expects to see proceeds of up to RM358 million from the disposal of its entire equity stake in MISC Integrated Logistics Sdn Bhd (MILS) to Swift Haulage Sdn Bhd and the settlement of shareholder's loan and other receivables due by MILS.
In a bourse filing today, the shipping giant said the purchaser will also assume all the liability of MILS.
MISC said the purchase consideration was arrived at on a "willing-buyer willing-seller" basis after taking into consideration MILS's audited net assets of RM255.5 million as at Dec 31, 2015.
According to MISC, Swift will fully repay the shareholder's loan (denominated in US dollar) owed by MILS to MISC of RM66.8 million upon completion of the agreement for sale and purchase of shares (SPA).
In addition, Swift will repay other receivables due from MILS to MISC of up to a maximum of RM34 million after completing the SPA.
MISC also said the proposed disposal is not expected to have any material effect on its earnings, gearing and net assets for the financial year ending Dec 31, 2016 (FY16).
Eduspec Holdings Bhd is looking to market its learning programmes and education services products to Thailand after signing a 60:40 joint venture (JV) agreement with Next2Steps, a provider of hardware and software solutions for Thailand's education sector.
In a filing with Bursa Malaysia, Eduspec said its wholly-owned subsidiary Eduspec Pte Ltd (EPL) today signed the JV agreement with Next2Steps for the purpose of marketing, distributing and selling a range of EPL's goods or products. The yet-to-be-named JV company has a paid-up capital of US$1 million.
Eduspec said the JV will bring no material earnings contribution for the current financial year ending Sept 30, but there is expectation that it will bring a positive contribution in the future.
Inix Technologies Holdings Bhd is planning to reduce by half the par value of its shares by cancelling five sen from the 10 sen value to eliminate its existing accumulated losses. Subsequent to that, it plans to consolidate every two shares of five sen each into one consolidated share.
The information technology company, which ventured into land reclamation last year, noted in its filing today that the below-par-value share price has deterred the company from raising funds from the equity market.
Hence, it hopes its par value reduction plan will provide it greater flexibility to raise funds and implement corporate proposals, which entails the issuance of new shares closer to its market price in the future.
As at May 6, Inix's issued and paid-up share capital was RM41.73 million, with 417.27 million shares.
The proposed par value reduction is expected to give rise to a credit of RM31.29 million, which will be used to offset its accumulated losses, which stood at RM15.15 million as at July 31, 2015.
Subject to shareholders' approval at an extraordinary general meeting to be convened, it expects the proposals to be completed by the second half of 2016.
Bison Consolidated Bhd, the operator of the myNEWS.com convenience store chain, has licensed its brand to a third party to establish outlets in Myanmar.
Its wholly-owned subsidiary Bison Stores Sdn Bhd has entered into a management agreement (MA) with SMI Retail Pte Ltd, a wholly-owned subsidiary of Singapore-listed Singapore Myanmar Investco Ltd.
SMI intends to establish two myNEWS.com retail outlets at the new terminal of Yangon International Airport.
"SMI has agreed to enter into the MA to appoint Bison Stores as independent contractor to provide management services and advisory support in relation to the business in the manner and on the terms and conditions of the MA," Bison said in a filing to Bursa Malaysia today.
In return, SMI will pay Bison Stores a minimum monthly management fee or a percentage of the gross revenue of the business, whichever is higher; while all salaries, remuneration, and all related expenses and costs will be borne by SMI.
The MA is valid for five years and may be renewed for another five years upon mutual agreement.
AirAsia Bhd said its load factor for the first quarter ended March 31 (1QFY16) rose to 86% from 77% a year ago. The number of passengers carried increased by 17% year-on-year (y-o-y) to 13.94 million from 11.88 million, said the low-cost carrier in a statement.
The number of seats flown or total capacity during 1QFY16 was 16.29 million, 6% higher than the 15.44 million seats reported for 1QFY15.
AirAsia said its Malaysian operations posted a load factor of 85% in 1QFY16, up 10 percentage points y-o-y.
"Demand exceeded capacity with 17% increase in the number of passengers carried at 6.48 million and 3% y-o-y increase in capacity," it said.
In Malaysia, AirAsia ended the quarter with a total fleet of 80 aircraft, while commencing five new routes: Kuala Lumpur — Shantou, Kota Kinabalu — Wuhan, Penang — Ho Chi Minh City and Yangon, and Langkawi — Guangzhou.
For Thai AirAsia Co Ltd, the group said the 45%-owned associate recorded a load factor of 88% in 1Q16, up five percentage points from a year ago. Its total passengers carried rose 18% to 4.37 million, outstripping the 11% capacity increase.
As for AirAsia's 48.9%-owned PT Indonesia AirAsia (IAA), load factor increased to 79% in 1QFY16, up nine percentage points from a year ago.
Number of passengers carried increased 2%, despite capacity reduction of 10% y-o-y, due to its turnaround plan, which saw two aircraft in 1QFY16 transferred out from IAA to the other affiliates, namely Thai AirAsia and AirAsia Philippines Inc.
IAA's total fleet at the end of 1QFY16 stood at 23 aircraft, which includes eight aircraft operated by PT Indonesia AirAsia Extra.
AirAsiaPhilippines, which is 39.9% owned by AirAsia, reported a load factor of 87% in 1QFY16, up 10 percentage points from a year ago.
Number of passengers carried grew 15% on-year to 970,000, supported by the increase in capacity of 2%. AirAsiaPhilippines ended the quarter with a total fleet of 14 aircraft.
Meanwhile, AirAsia (India) Pvt Ltd posted load factor of 86% in 1QFY16, up six percentage points from a year ago. Number of passengers carried stood at 540,000, up by 127% compared to 1QFY15. At the end of the quarter, its total fleet stood at six aircraft.