Kossan 4Q net profit up 21.4pct to RM29.45m on better product mix, margin

Kossan 4Q net profit up 21.4pct to RM29.45m on better product mix, margin
Written by Surin Murugiah of theedgemalaysia.com
Wednesday, 23 February 2011 20:51


KUALA LUMPUR: KOSSAN RUBBER INDUSTRIES BHD [] net profit for the fourth quarter ended Dec 31, 2010 rose 21.4% to RM29.45 million from RM24.25 million a year ago, driven by the expansion in the company’s gloves division with better product mix and margin.

It said on Wednesday, Feb 23 revenue rose 11% to RM252.97 million from RM227.75 million. Earnings per share were 9.18 sen while net assets per share was RM1.40.

For the financial year ended Dec 31, 2010, Kossan’s net profit recorded an increase of 76.1% to RM118.59 million from RM67.33 million a year ago. Revenue rose 24.6% to RM1.05 billion from RM842.14 million.

Kossan said the results for 2010 were within expectations. “For the year, demand for gloves remains good and management is cautiously optimistic of consistent performance in the financial year of 2011,” it said.

HLFG 4Q earnings surge 437pct to RM787m, also aided by one-off gains

HLFG 4Q earnings surge 437pct to RM787m, also aided by one-off gains
Written by Joseph Chin of theedgemalaysia.com
Wednesday, 23 February 2011 21:38


KUALA LUMPUR: The HONG LEONG FINANCIAL GROUP BHD [] (HLFG) posted net profit of RM787 million in the fourth quarter ended Dec 31, 2010, which was a 437% increase from the RM146.38 million a year ago.

The financial services group said on Wednesday, Feb 23 the higher profit was mainly due to a one-off gain on the transfer of HLA general business to MSIG Insurance (Malaysia) Bhd (MSIM) of RM619 million.

“Backing off this one-off gain, HLFG would still record an increase of profit by RM90.1 million (up 29.9%) mainly from better performances by all divisions,” it said.

HLFG said revenue rose 134% to RM1.3 billion from RM554.25 million while earnings per share were 76 sen compared with 14.10 sen.

It said the commercial banking division recorded pre-tax profit of RM359.7 million versus RM291.3 million a year ago, mainly due to higher net interest income and higher share of results from its equity stake in Bank of Chengdu.

As for the investment banking, the division recorded pre-tax profit of RM19.4 million compared to RM4.3 million a year ago.

Its insurance division recorded pre-tax profit of RM650.7 million compared to RM16.3 million a year ago.

HLFG said excluding the one-off gain on transfer of HLA General business to MSIM, the insurance division would still record an increase in profit of RM15.4 million, mainly due to the share of profit for the 30% associate stake in MSIM.

For FY10, net profit surged past the RM1 billion mark to RM1.112 billion, up 266% from RM303.97 million in FY09. Its revenue was RM2.073 billion compared to the RM1.116 billion in FY09.

“The higher profit was mainly due to a one-off gain on the transfer of HLA General business to MSIM of RM619 million. Backing off this one-off gain, HLFG would still record an increase of profit by RM90.1 million (up 29.9%) mainly from better performances by all divisions.

For the financial year, the pre-tax profit increased by RM913.6 million to RM1.517 billion from RM604.1 million, up RM913.6 million. The factors were due to a surplus transfer of RM175 million from HLA Life division and a RM619 million one-time gain on transfer of HLA General’s business to MSIM.

Backing off the one-time gain and one-time surplus transfer from Life, the group pre-tax profit was 19.8% higher at RM723.7 million.

The commercial banking division recorded pretax profit of RM677.1 million compared to RM580.1 million in FY09 due to higher net interest income and higher share of results from its stake in the Bank of Chengdu.

Genting Bhd 4Q earnings up 89.6pct to RM465.43m, for FY10 RM2.2b

Genting Bhd 4Q earnings up 89.6pct to RM465.43m, for FY10 RM2.2b
Written by Joseph Chin of theedgemalaysia.com
Wednesday, 23 February 2011 19:17


KUALA LUMPUR: GENTING BHD []’s net profit surged 89.6% to RM465.43 million in the fourth quarter ended Dec 31, 2010 from RM245.4 million a year ago.

It said on Feb 23 revenue rose 76% to RM4.086 billion from RM2.320 billion. Earnings per share were 12.57 sen compared with 6.64 sen while it proposed a final dividend of 4.5 sen compared with 4.20 sen a year ago.

It said the higher revenue was mainly from the leisure and hospitality division with the commencement of operations of Resorts World Sentosa in Singapore, during the first quarter of 2010.

“Revenue from Resorts World Genting in Malaysia increased mainly due to better luck factor in the premium players business. The revenue from the UK casino operations decreased mainly due to poor luck factor and the weaker sterling pound. However, the UK business volume has shown improvement over the previous year’s corresponding quarter,” it said.

Genting said the PLANTATION [] division benefited from higher palm products prices. However, its power division recorded lower revenue due to lower generation of electricity by the Kuala Langat and the Meizhou Wan power plants.

“The higher adjusted EBITDA from the Leisure & Hospitality Division in 4Q2010 was mainly attributable to RWS. RWG’s adjusted EBITDA increased due to higher revenue, whilst the UK casinos’ adjusted EBITDA was affected by lower revenue,” it said.

As for FY10, its earnings rose 110.9% to RM2.202 billion from RM1.044 billion while revenue surged 71% to RM15.194 billion from RM8.893 billion.

Group revenue rose by 71% to record a new high of RM15.19 billion in FY2010 (FY2009: RM8.89 billion), while group profit before tax rose by 74% to post a new high of RM4.39 billion in FY2010 (FY2009: RM2.53 billion).

Group adjusted EBITDA rose by 89% to post a new high of RM7.11 billion in FY2010 (FY2009: RM3.77 billion).

Genting M'sia raised to ‘buy’ at Maybank

Genting Malaysia Bhd, a casino and hotel operator, was raised to “buy” from “sell” at Maybank Investment Bank Bhd to reflect its resilient operations and growth prospects.

The share price estimate was increased to RM3.67 from RM2.90 , Wong Chew Hann, an analyst at Maybank, wrote in a report today. - Bloomberg

Read more: Genting M'sia raised to ‘buy’ at Maybank http://www.btimes.com.my/Current_News/BTIMES/articles/20110224095917/Article/index_html#ixzz1ErtyFuhU

DiGi hits record high

DiGi.Com Bhd, a Malaysian mobile- phone operator, rose to a record after UOB-Kay Hian Holdings Ltd recommended buying the stock because of its “high” dividends and “defensive” qualities amid the Middle East turmoil.

The stock climbed 2.6 per cent to RM26.64 at 12:06 pm local time, set to close at an all-time high, compared with the benchmark FTSE Bursa Malaysia KLCI Index’s 0.1 per cent decline. DiGi.Com is the biggest gainer on the gauge today.

“Telecommunications stocks stand out for their high dividend yields backed by stable cashflows, and our top telco pick is DiGi,” Vincent Khoo, an analyst at UOB-Kay Hian, wrote in a report today. “Stay relatively defensive until the Middle East issue boils over.”

Digi.Com, which has gained 8.5 per cent this year, has a dividend yield of 6.14 per cent, compared with the average of 3.4 per cent for the 30 companies in the benchmark index, according to data compiled by Bloomberg. DiGi.Com and PLUS Expressways Bhd. are among stocks investors should buy as Middle East violence boosts global equity risk premiums and oil prices, Khoo said.

Oil advanced for a sixth day in New York after reaching US$100 a barrel as Libya’s violent uprising cut shipments from Africa’s third-biggest producer.

The fighting in Libya, which holds Africa’s largest oil reserves, is the most violent yet seen in six weeks of popular uprisings across the Middle East and North Africa, which have already unseated longtime rulers in Tunisia and Egypt.

Commodity and energy-linked sectors such as palm oil and oil and gas companies are also “obvious beneficiaries” of higher oil prices while potential losers are AirAsia Bhd and Tenaga Nasional Bhd, Khoo said. - Bloomberg

Read more: DiGi hits record high http://www.btimes.com.my/Current_News/BTIMES/articles/20110224113201/Article/index_html#ixzz1ErtMy0fj

Hong Leong Bank Q2 net climbs 30pc

HONG Leong Bank Bhd (5819)said its second quarter net profit jump 30 per cent as it made more money in all key businesses.

Net profit for the quarter to December 31 2010 was RM291.4 million compared with RM224.7 million in the same quarter a year ago.

In a statement yesterday, the lender said revenue also rose to RM603.9 million from RM519.4 million before.

This was aided by lending out of its Singapore branch, profit contributions from global markets, the treasury division and Islamic banking arm and loan growth in the auto, property and small and medium sized enterprises.

Group managing director and chief executive Yvonne Chia said on a pre-tax profit basis the quarter's RM360 million profit marks the strongest quarter in the past five financial years.

"We are satisfied that the underlying operations are sound to strongly support the growth opportunities and the bank's track record of sustainably creating shareholder value remains firm, with return on average shareholder funds at 16.4 per cent and annualised earnings per share at 75.5 sen".

The bank has a loan to deposit ratio of 68 per cent, which means it has room to continue growing its loans.

Chia remains optimistic of prospects due to the rebound in economic activities.

For the first six months to December 2010, the lending portfolio for the purchase of residential properties grew 16 per cent while for the purchase of non-residential properties saw an expansion of 15 per cent.

Hong Leong Islamic Bank Bhd, the group's wholly-owned subsidiary, contributed 7 per cent of the Group's pre-tax profits in the first half of the financial year.

Profits from the group's 20 per cent shareholding in Bank of Chengdu Co Ltd. grew 41 per cent year-on-year to RM81 million for the six-month period.

Read more: Hong Leong Bank Q2 net climbs 30pc http://www.btimes.com.my/Current_News/BTIMES/articles/HONRES/Article/#ixzz1ErsFndVQ

Wilmar results miss forecasts

SINGAPORE: Wilmar International, the world's largest palm oil plantation firm by market value, reported a 28 per cent decline in quarterly earnings on losses from it oilseeds and grains units, missing forecasts and knocking its shares down 5 per cent.

Wilmar, which earns more than half of its revenue from China, said it is optimistic about the outlook for 2011, with commodity prices expected to remain firm. Still, analysts say the company faces huge pressure on its margins from rising food prices that have pushed up its feed stock costs, while price caps in China are preventing it from passing on increases to customers.

Wilmar shares fell as much as 5 percent to S$5.14 (S$1 = RM2.39), its lowest since mid-2009. Shares of Wilmar were 4.4 per cent lower at S$5.17 at 0730 GMT. They have lost about 8 per cent since the start of the year.

"The numbers are significantly below consensus and our forecasts. The sole factor to that is two consecutive quarterly losses in their oilseeds and grains division," said a Singapore-based analyst, who declined to be identified because he is not authorised to speak to the media.

"The way the company blamed this on weak margins and inopportune buying is kind of a euphemism for 'we got it wrong'."

Wilmar's palm oil plantations in Indonesia and Malaysia supply less than 10 per cent of the demand of its refineries, while logistical and regulatory challenges prevent the company from expanding plantation area.

Wilmar, which has a market value of US$27 billion (US$1 = RM3.05), booked an October-December net profit of US$318.6 million, down from US$442 million a year ago, missing analysts' forecasts of US$378 million.

The company's oilseeds and grains business reported a pre-tax loss of US$173.2 million in the fourth quarter, despite a 15.9 per cent increase in revenue to US$3 billion, and 4.2 per cent increase in volume.

Wilmar said in the statement that the performance of the oilseeds and grains business reflected "very poor crush margins from excessive imports of beans by the industry and the group's less timely purchases of raw materials."

Its consumer products division registered a 33.4 per cent decline in the fourth quarter to US$37.5 million, also on weaker margins due to rising prices of edible oils feedstock, despite a 29.3 per cent rise in revenue.

"The key disappointment came from the larger losses in soyabean crushing despite earlier management guidance that the third quarter would be the worst quarter for this division," brokerage house UOB Kay Hian said in a note to clients.

Wilmar's chairman and chief executive Kuok Khoon Hong said in a statement that the group was optimistic about 2011 despite the weaker performance. - Reuters

Read more: Wilmar results miss forecasts http://www.btimes.com.my/Current_News/BTIMES/articles/wilmo/Article/#ixzz1ErrABh95

Buy ‘defensive’ Bursa stocks: UOB Kay Hian

Investors should buy “defensive” stocks with high dividend yields such as Malaysia’s DiGi.Com Bhd and PLUS Expressways Bhd to ride out the Middle East turmoil, according to UOB Kay Hian Holdings Ltd.

Commodity and energy-linked sectors such as palm oil and oil and gas companies are also “obvious beneficiaries” of higher crude oil prices while potential losers are AirAsia Bhd and Tenaga Nasional Bhd, Vincent Khoo, an analyst at UOB Kay Hian, wrote in a report today. - Bloomberg

Read more: Buy ‘defensive’ Bursa stocks: UOB Kay Hian http://www.btimes.com.my/Current_News/BTIMES/articles/20110224113405/Article/index_html#ixzz1ErqmYIbR

LPI Capital targets 15pct growth in gross premiums in FY11

LPI Capital targets 15pct growth in gross premiums in FY11
Written by Chong Jin Hun at theedgemalaysia.com
Thursday, 24 February 2011 14:03


KUALA LUMPUR: Insurer LPI CAPITAL BHD [] is targeting a 15% growth in gross premiums in the financial year ending Dec 31, 2011.

Its chief executive officer Tee Choon Yeow said on Thursday, Feb 24, the growth would be boosted by new businesses from strategic partners which are also global insurers.

He said LPI was also expanding its agency force with three planned branch offices in Peninsular Malaysia. It has 16 branches now.

“Net profit growth for FY11 should be more than 15%,” he told reporters after its AGM here. In FY10, LPI raked in RM755.93 million in gross premiums.

Philip Fisher: Quality first, Price second

Fisher formulated a clear and sensible investing strategy (which I'll get to in a second), wrote one of the best investment books of all time, Common Stocks and Uncommon Profits, and made a good deal of money for himself and his clients.


His son wrote that Phil's best advice was 

• to "always think long term," 
• to "buy what you understand," and 
• to own "not too many stocks." 

Charles Munger, who is Buffett's partner, praised Fisher at the 1993 annual meeting of their company, Berkshire Hathaway Inc. (BRK/A): "Phil Fisher believed in concentrating in about 10 good investments and was happy with a limited number.  That is very much in our playbook. And he believed in knowing a lot about the things he did invest in. And that's in our playbook, too. And the reason why it's in our playbook is that to some extent, we learned it from him."


In addition to the warning against over-diversification — or what Peter Lynch, the great Fidelity Magellan fund manager, calls "de-worse-ification" — the book makes three important points:


(1)  First, don't worry too much about price.  (Quality first, Price second)

• "Even in these earlier times [he's talking here about 1913], finding the really outstanding companies and staying with them through all the fluctuations of a gyrating market proved far more profitable to far more people than did the more colorful practice of trying to buy them cheap and sell them dear."

• In fretting about whether a stock is cheap or expensive, many investors miss out on owning great companies. My own rule is: quality first, price second.

(2)  Second, Fisher says that investors must ask, "Does the company have a management of unquestionable integrity?" 

(3)  Finally, Fisher offered the best advice ever on selling stocks. "It is only occasionally," he wrote, "that there is any reason for selling at all."


Yes, but what are those occasions? They come down to this: Sell if a company has deteriorated in some important way. And I don't mean price! 


Fisher's view, instead, is to look to the business — the company itself, not the stock. 


"When companies deteriorate, they usually do so for one of two reasons: 

• Either there has been a deterioration of management, or 
• the company no longer has the prospect of increasing the markets for its product in the way it formerly did."

A stock-price decline can be a key signal: "Pay attention! Something may be wrong!" But the decline alone would not prompt me to sell. Nor would a rise in price. 


Time to sell? If you did, you missed another doubling.


"How long should you hold a stock? As long as the good things that attracted you to the company are still there."


http://myinvestingnotes.blogspot.com/2010/09/learning-from-long-men-late-phil-carret.html