Hua Yang proposes one-for-three bonus issue

by **Cals** Thu 18 Jul 2013, 10:01

Hua Yang proposes one-for-three bonus issue
Business & Markets 2013
Written by Charlotte Chong of theedgemalaysia.com
Thursday, 18 July 2013 09:51

KUALA LUMPUR: Property developer HUA YANG BHD [] has proposed to undertake a one-for-three bonus issue of 66 million new ordinary shares of RM1 each, through capitalising a sum of RM66 million from its retained earnings.

The company said in an announcement to Bursa Malaysia yesterday that the proposed bonus issue would increase the capital base of the company to a level which will better reflect the current scale of its operations and its subsidiaries.

“The proposed bonus issue aims to reward the shareholders of the company for their loyalty and continuing support by enabling them to have greater participation in the equity of the company,” it said.

The company expects the bonus issue to be completed by the second half of this year.

Hua Yang’s issued and paid-up share capital stood at RM198 million, comprising 198 million RM1 shares as at July 15. Upon the completion of the proposed bonus issue, the issued and paid-up share capital of the company would increase to RM264 million, comprising 264 million shares.

The increased number of shares would result in the adjustment of its net assets value (NAV) per share and gearing ratio.

The NAV per share would be adjusted to RM1.20 from RM1.69, while the gearing ratio would be slightly raised to 0.36 from 0.34, as per its audited results for 2013 financial year ended March 31 (FY13).

“The board has confirmed that the company has adequate retained earnings available for the capitalisation of the bonus shares,” it said.

Hua Yang said in a separate announcement that its net profit has decreased 25.2% to RM12.3 million in the first quarter ended June 30 (1QFY14), against RM16.47 million in 1QFY13. Its revenue has also dropped 17.8% year-on-year to RM80.5 million.

It explained that the lower revenue and profit was due to slower progress in CONSTRUCTION [] and minimal launch recognition from the preceding quarter and current quarter.

Its earnings per share for 1QFY14 stood at 6.22 sen while NAV per share stood at RM1.75.

Hua Yang rose 3.93% to close at RM3.17 yesterday with 1.4 million shares traded.

This article first appeared in The Edge Financial Daily, on July 18, 2013.