Cahya Mata's 3Q earnings fall 10% on associate losses, higher tax

by **Cals** Wed 25 Nov 2015, 23:28

Cahya Mata's 3Q earnings fall 10% on associate losses, higher tax

By Ahmad Naqib Idris / theedgemarkets.com | November 25, 2015 : 6:19 PM MYT

KUALA LUMPUR (Nov 25): [size=16]Cahya Mata Sarawak Bhd (CMSB) ([You must be registered and logged in to see this image.] Valuation: 0.50, Fundamental: 2.70) reported net profit of RM65.48 million or 6.09 sen per share for the third quarter ended Sept 30, 2015 (3QFY15), down 10% from RM72.38 million or 6.97 sen per share in the previous year.

According to its financial statements, the group saw negative contribution from its associates and incurred higher income tax expense during the quarter.

Excluding the income tax expense, the group's pre-tax profit was flat at RM104.56 million, compared to RM104.18 million a year earlier.

CMSB said its cement division, construction materials and trading division and its construction and road maintenance division were the main contributors of its performance, as the three segments reported higher profit for the quarter.

Meanwhile, the property development segment saw lower profit year-on-year, as its 3QFY14 profit was boosted by a one-off land sale.

Revenue for 3QFY15 was marginally lower at RM411.84 million compared to RM413.07 million in 3QFY14.

For the nine months ended Sept 30 (9MFY15), net profit fell 8% to RM163.56 million from RM177.39 million a year earlier, while revenue climbed 9% to RM1.28 billion from RM1.17 billion in 9MFY14.

In a statement, CMSB group managing director Datuk Richard Curtis said the first nine months have been challenging, due to macroeconomic factors such as the appreciation of the US dollar, which has resulted in higher cost of raw materials for its cement division.

"Within Sarawak, however, the continued focus on the state's infrastructure has resulted in strongly improved pre-tax profit results from our construction materials & trading and construction & road maintenance divisions," said Curtis.

Going forward, he said the group is optimistic about posting a "good financial performance" for FY15, as it expects its overall businesses to remain on a steady uptrend.

He added that the group's 25% stake in the joint venture with OM Holdings Ltd, 40% stake in an integrated phosphate products complex with Malaysian Phosphate Additives Sdn Bhd and Arif Enigma Sdn Bhd and its 50% stake in Sacofa Sdn Bhd are expected to increase shareholder value in the medium term.

"Our healthy balance sheet and experienced management team enable us both to sustain our core businesses in the face of any headwinds and to maximise our participation in the Sarawak growth story and thus position ourselves to accelerate our long-term sustainable growth," he said.

CMSB shares gained 10 sen or 1.97% to close at RM5.17, bringing its market capitalisation to RM5.44 billion.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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