May 16th - Stocks To Watch SapuraKencana, Dialog, Lysaght, MAS, AEON Co, SILK, Gas M’sia, EngTex, MBSB, Inari

by **Cals** Fri 16 May 2014, 02:20

Stocks To Watch SapuraKencana, Dialog, Lysaght, MAS, AEON Co, SILK, Gas M’sia, EngTex, MBSB, Inari

Business & Markets 2014

Written by Ho Wah Foon of theedgemalaysia.com

Thursday, 15 May 2014 20:06

KUALA LUMPUR (May 15): Based on corporate announcements and results released to Bursa Malaysia today, the following companies may be in focus tomorrow:

SapuraKencana Petroleum Bhd announced that it has been awarded RM1 billion (US$312 million) worth of contracts, via its subsidiaries across its different divisions.

For its drilling division, wholly-owned subsidiary SapuraKencana Drilling Holdings Ltd has been awarded a contract for the provision of offshore drilling rig and services by CNR International.

The group also won three other contracts for its offshore construction and subsea services division.

For its fabrication, hook-up and commissioning division, wholly-owned subsidiary Kencana HL Sdn Bhd was awarded a contract for the provision of detailed engineering, procurement, construction, and commissioning for the Layang Development Project by JX Nippon Oil & Gas Exploration (Malaysia) Limited.

The group said that the contracts “are expected to contribute positively towards the earnings of SapuraKencana Group for the financial year ending 31 January 2015 and the financial periods thereafter.”

Dialog Group Bhd’s net profit rose 6% year-on-year (y-o-y) to RM49.6 million in the third quarter ended Mar 31, 2014, from RM46.8 million.

Revenue inched up 0.3% y-o-y to RM638.3 million from RM636.6 million.

Dialog declared an interim single-tier dividend of 11% per ordinary share, which is 1.1 sen per share, in respect of the financial year ending Jun 30, 2014.

The oil & gas service provider said its higher profit was due to larger revenue and improved net profit margin from its international operation.

For the nine-month period, net profit chalked RM163.6 million versus RM141.1 million in the previous period while revenue recorded RM1.91 billion from RM1.56 billion a year ago.

“The oil and gas sector in Malaysia is expected to remain a main growth driver for the Malaysian economy contributing some 20% of the nation’s gross domestic product,” said Dialog on prospects ahead.

“The group is poised to benefit from the positive industry outlook as the group strategically grows the core businesses,” it said.

Lysaght Galvanized Steel Bhd proposed a share split, subdividing each of its existing ordinary share of RM1.00 into two new ordinary shares of 50 sen each.

The group also proposed a bonus issue of 41.58 million new ordinary shares of 50 sen each on the basis of one bonus share for every two subdivided shares held after the share split exercise.

The group will also be issuing 62.37 million free warrants in Lysaght, on the basis of three warrants for every four subdivided shares held by shareholders.

The group said that the rationale behind the proposals was to improve the trading liquidity of its shares, while also rewarding its shareholders.

Malaysian Airline System Bhd's (MAS) net loss widened to RM443.4 million in the first quarter ended March 31, 2014 from a net loss of RM278.8 million a year earlier. Revenue was higher at RM3.6 billion compared to RM3.54 billion.

MAS said net loss had widened as costlier jet fuel raised operating expenses. Higher depreciation, amortisation and impairment also hurt. An increase in finance cost had also curbed bottom line.

"The tragic MH370 incident on 8 March 2014 had a dramatic (negative) impact on the traditionally-weak first-quarter performance.

The company said yield was under pressure due to competition and weaker consumer demand.

Looking ahead, MAS said it foresaw a challenging business landscape this year amid high fuel and operating costs, and unfavourable foreign exchange rates.

AEON Co. (M) Bhd’s net profit fell 8.3% year-on-year (y-o-y) to RM46.9 million in the first quarter ended Mar 31, 2014, from RM51.1 million.

But, revenue rose 8.8% y-o-y to RM945.5 million from RM869.3 million.

The retail group said the lower profit was due to higher operating costs including the initial costs associated with new stores opening.

“The group, leveraging on its 30th year anniversary activities, competitive strengths and refurbishment programme, remains optimistic of an improved performance this year,” it said.

SILK Holdings Bhd’s subsidiary has bagged a contract worth RM23 million from Carigali Hess Operating Company Sdn Bhd to deliver one unit of straight supply vessel.

SILK said its subsidiary Jasa Merin (Malaysia) Sdn Bhd was awarded the contract by Carigali Hess.

The contract which commenced on May 12, 2014 will last for two years, with extension options of one year.

“The contract is expected to contribute positively to the earnings of the group for the financial year ending Jul 31, 2014 and beyond,” said SILK.

Gas Malaysia Bhd reported net profit of RM41.6 million for its first quarter ended March 31, 2014, rising 4% from RM40.1 million in the previous year’s corresponding quarter.

Revenue for 1QFY14 rose 8% to RM580.6 million from RM535.4 million.

“The growth in revenue and profit before tax for the financial period ended 31 March 2014 as compared to financial period ended March 31, 2013 was primarily driven by the increase in volume of gas sold and number of customers,” said the group.

The group expects to sustain the increase in gas volume and number of customers for FY14.

Engtex Group Bhd’s net profit plunged 25% year-on-year (y-o-y) to RM10.5 million in the first quarter ended Mar 31, 2014, from RM13.9 million.

Revenue fell 3.4% y-o-y to RM260.3 million from RM269.4 million.

The pipe manufacturer attributed its weaker profit and revenue to weak market demand for certain steel products and higher operating cost of property development projects in Selayang.

For its property development division, the firm said the division reported a loss mainly due to higher operating cost of projects in Selayang.

Malaysian Building Society Bhd’s (MBSB) net profit for the first quarter ended March 31, 2014, rose 18.41% year-on-year to RM196.73 million from RM166.14 million a year earlier, driven mainly by higher profit and interest income from personal financing and corporate loans respectively.

MBSB said revenue for the quarter rose to RM667.11 million from RM562.48 million a year earlier.

Earnings per share was 8.37 sen compared to 13.08 sen a year earlier, while net asset per share was RM1.46.

On its prospects, MBSB said the growth of its personal financing and mortgage portfolios would be more challenging in 2014 after Bank Negara Malaysia’s measures to further promote a sound and sustainable household sector in July 2013.

Inari Amertron Bhd saw group net profit for the third quarter ended 31 March 2014 (3Q14) leaped 101.5% to RM25.0 million, from RM12.4 million recorded in previous year similar quarter.

Inari Amertron’s performance came on the back of a 237.8% increase in 3Q14 group revenue to RM191.8 million.

For the nine months ended 31 March 2014 (9M14), group revenue rose 228.4% to RM569.8 million from RM173.5 million previously; while net profit leaped 143.7% to RM70.4 million from RM28.9 million previously.

Inari Amertron declared a third single-tier interim dividend of 1.2 sen and special dividend of 0.8 sen per share in respect of the financial year ending 30 June 2014, payable on a later date to be determined.