The Star Online: Business
The Star Online: Business |
- UMW hits record net profit in 2012
- JTI worried about impact of illegal cigarette sales, cheaper local brands
- More growth ahead for Pantech after strong earnings
| UMW hits record net profit in 2012 Posted: 25 Apr 2013 07:16 PM PDT PETALING JAYA: UMW Holdings Bhd achieved a new record for its year ended Dec 31, 2012 when its total comprehensive net income increased 62.62% to RM1.57bil on the back of a 17.2% increase in revenue to RM15.86bil from a year ago. Net profit attributable to equity holders improved 104.7% to RM994.3mil. All four core business segments of the group reported better profits for 2012. "2012 was another record-year for the UMW Group. In tandem with the increase in revenue, our profit before taxation increased substantially to RM2bil, from the RM1.4bil registered in 2011. "We look forward to challenging ourselves for a better 2013," said Datuk Syed Hisham Syed Wazir, UMW president and group chief executive officer, in a statement. Moving forward to 2013, Umw said that UMW Toyota Motor and Perusahaan Otomobil Kedua Sdn Bhd were targeting to sell higher units than the 295,759 units sold in 2012. The UMW Group had a market share of 47.1% in 2012. UMW said that 2013 would remain challenging due to intense competition in the market, with aggressive promotions on new model launches in the automotive industry. The Malaysian Automotive Association forecasts the total industry volume for the year 2013 to improve by about 2% to 640,000 units from the 627,753 units achieved in 2012. For the equipment segment, revenue is expected to be slightly lower than 2012. "Uncertain external factors may affect the demand for equipment. However, profitability of this segment is expected to sustain, resulting from better cost management and increased parts sales," said UMW. Meanwhile, in the oil and gas segment, UMW is expecting an improved performance, contributed by a full-year contribution from the semi-submersible drilling rig 'NAGA 1', the contribution from NAGA 4 and the commissioning of the new Electric Resistance Welded and coating plant in China. UMW said that NAGA 4 received a contract from Petronas Carigali Sdn Bhd for a three-year period worth US$157.68mil (RM478.79mil) this month. Fourthly, the performance of UMW's manufacturing and engineering segment is expected to improve on higher capacity utilisation for its automotive component plants in India and lubricant plant in China. UMW also expects increased sales of its Repsol and Pennzoil lubricants.
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| JTI worried about impact of illegal cigarette sales, cheaper local brands Posted: 25 Apr 2013 07:10 PM PDT KUALA LUMPUR: JT International Bhd (JTI) is expecting the industry to "remain extremely challenging" this year due to the continued sale of illegal cigarettes and the impact from certain local brands being sold below the Government-mandated minimum cigarette price. The company, which has the second-biggest cigarette market share in the country, cited a recent Goldman Sachs intelligence report that stated that illicit trade in Malaysia was the second-highest in the world. "If you look at the illicit trade situation in the market today, total illicit trade (of the entire market) last year was at 34.5%, which is just a marginal decline from 2011's 36.1%. "These are still very high figures, and we are the second-highest in the world," JTI's chief financial officer Thean Nam Hooi told journalists after its AGM. While acknowledging the enforcement agencies' efforts to reduce the trade, he said any further drastic increases in excise duties might result in undesired outcomes for the industry. "Any further drastic excise hikes would probably push total excise revenues down, so I can't gauge what the Government would do. But we are hopeful that there would be a pragmatic approach to excise taxation moving forward," Thean said. The company's managing director Robert Stanworth hopes that any increase in the excise duties would be done in an organised manner. "The important thing with excise duties, as we have experienced in many organisations in many markets, is that it be moderate and predictable. "We understand that the Government might want to increase it from time to time, but it is important that it is moderate and predictable to a certain degree so that the market can absorb it," he said. "Any large and sudden increase almost inevitably causes a decline in the legitimate market, resulting in lower revenues for the Government at the end of the day," Stanworth added. Meanwhile, JTI said that while it did not have a formal dividend policy, any excess liquidity on top of its working capital needs would be returned as dividends. On another matter, the company will rebrand its Mild Seven cigarettes to Mevius by the middle of this year. This would involve the full range of the Mild Seven brand, an official statement said. According to the Nielsen Retail Audit Report, JTI recorded a market share of 19.6% in 2012, compared to 19.9% the year before. Its Mild Seven recorded an increase in market share to 4.4% last year from 4.1% in 2011. Winston's market share, in the meantime, declined to 9.8% last year from 10% in 2011.
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| More growth ahead for Pantech after strong earnings Posted: 25 Apr 2013 07:04 PM PDT KUALA LUMPUR: RHB Research sees more upside for Pantech after it posted a strong set of results for the financial year ended Feb 28, 2013 (FY end-Feb 2013), prompting it to keep a Buy recommendation with fair value of RM1. It said Pantech's RM55mil net profit for FY13, (up 59.4% on-year) were largely in line with its RM53.7mil forecast but slightly below consensus' estimate of RM57.0mil. "Earnings fell 19.2% on-quarter but we deem this as normal given that sales are typically slower in the fourth quarter due to the many festivities. "The trading division recorded stronger sales of RM384.1mil (up 25% on-year) and profit before tax of RM59.8mil (up 39% on-year), mainly buoyed by robust demand from oil and gas companies with their ongoing projects," it said. RHB Research said margins from the division improved due to more efficient cost controls. It noted that the manufacturing division's sales and profit before tax soared by 100% on-year and 247% on-year respectively, fuelled by strong contribution from Nautic Steel and a better product mix at its carbon steel manufacturing segment. "We are confident that Pantech's outlook remains bright as we understand that management has been actively securing new contracts to improve the company's earnings profile. "We do not discount the possibility of Pantech looking for new M&A targets to duplicate Nautic Steel's success. Management indicated it has plans to boost Nautic Steel's production capacity," it said. RHB Research said it also learned that its stainless steel plant, which had weighed down the group's performance in the past, finally broke even. Hence, we expect positive contribution from this segment moving forward," it said. "As we are bullish on the counter, we maintain our Buy recommendation and RM1 fair value, pegged to 9.0 times FY14 forecast diluted earnings per share, assuming all its shareholders convert their irredeemable convertible unsecured loan stocks (ICULS) before the 2017 expiry date," said the research house.
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