Hot Stock GAB rises on good FY13 performance, dividend

Hot Stock GAB rises on good FY13 performance, dividend
Business & Markets 2013
Written by Shalini Kumar of theedgemalaysia.com
Friday, 23 August 2013 11:21

KUALA LUMPUR (Aug 23): Guiness Anchor Bhd saw its share price rise in morning trades today, following the group's announcement of its 2013 financial year results yesterday, which were in line with analyst's performance.

GAB also declared a final dividend of 49 sen per share, bringing its full-year payout to 69 sen per share.

At 10.55 am, GAB was trading 30 sen higher at RM18.30 with 15,900 shares done. It was the top gainer across the exchange.

"GAB's FY13 net profit of RM217.6 million was largely in line with expectations, making up 96% of both our and consensus estimates," said RHB Research in a note today.

"During the year, revenue increased at a slower pace, which we believe is due to flat volume growth. That said, a mainstream-premium brand beers substitution effect persists and, coupled with cost optimisation efforts, has helped to improve its overall profitability margins in FY13," it added.

"Going forward, we expect Guinness to see improving average selling prices and widening margins on the back of robust premium beer sales. As for an excise duty hike, we do not foresee an increase, as the sector plays a part in boosting Malaysia’s tourism industry," said the research house in its note.

RHB also said its earnings forecasts for the group remained unchanged, as its positive outlook remained intact. However, the research house explained that GAB's outlook could be affected by a slowdown in sales volume or an excise duty hike.