This article first appeared in The Edge Financial Daily on February 21, 2020

SIG Gases Bhd (-ve)

TRADING of shares in SIG Gases Bhd (fundamental: 1.35/3, valuation: 2.2/3) triggered our momentum algorithm yesterday for the first time this year.

The counter of the industrial gas solutions and services company closed up half a sen or 1.14% at 44.5 sen yesterday with 535,300 shares traded, compared with its 200-day average volume of 265,954.5 shares.

For the third quarter ended Sept 30, 2019, it posted a net profit of RM2.38 million, over two times the RM835,000 it recorded for the same quarter of the previous year, on a revenue of RM20.31 million from RM21.51 million. The increase in earnings was due to a higher gross profit following the adoption of the Malaysian Financial Reporting Standard 5, which requires no depreciation provision for the quarter under review.

For the cumulative nine months ended Sept 30, 2019, however, the group’s net profit sank to RM2.64 million from RM3.35 million, as revenue slipped to RM58.05 million from RM59.03 million.