FBMKLCI
1813.25pts +10.04pts
(+0.56%) Volume 1.924b Value 2.148b
1) The KLCI closed higher before the weekend following
the strong performance by the U.S market overnight after the nation released a
positive set of jobs data as well as the firmer oil prices overnight boosted
energy names. In the regional market, bourses were mixed as the SHCOMP -1.93%
and HSI -0.35% closed lower after an official from the PBOC said that the
latest Reserve ratio cut was not the start of a strong stimulus, NIKKEI closed
+0.55% higher. In the local scene, CONSUMER +0.69% index picked up during the
last hour of trade boosted by BAT +1.47%, GAB +6.39%, CARLSBG +3.68%. Market
breadth was positive today with gainers beating losers by 512 : 291. Futures
closed at 1804.5 (9pts discount)
2) Heavyweights : PBBANK +1.84% RM18.78, TENAGA +1.92%
RM14.82, CIMB +1.04% RM5.80, ASTRO +5.36% RM3.14, PETDAG +4.54% RM18.88,
SKPETRO +1.44% RM2.81, IOICORP +0.84% RM4.79, MAXIS -1.13% RM6.99.
3) DBT: RPB 3.7mil @ RM0.38, HWANG 1.5mil @ RM1.95, UZMA
1.121mil @ RM2.20 (3.7% Premium)
4) Situational:-
MEGB + 1.61% RM0.63 - Masterskill Education Group Bhd's
(MEGB) is disposing of its property assets here and in Masai, Johor to a
private company controlled by outgoing major shareholder Siva Kumar M.
Jeyapalan for RM79.7m. Simultaneously, MMSB had also entered into an agreement
with the private company - Brilland Property Sdn Bhd - for the lease of one of
the properties in Johor for 10 years. MEGB is expected to make a one-off gain
on disposal estimated to be about RM4.5m for the group, based on the unaudited
net book value (NBV) of the properties of RM75.2m as at Dec 31, 2014 and the
disposal price of RM79.7m. MEGB's gearing ratio will also drop to 0.06 times from
0.18 times currently.
5) MISC : FY12/14 Rev+4% RM9.3b Net+5% RM2.2b
EPS 49.4s Div 10s
Results
8% ahead of cons RM1.93b
For 12 months yoy, higher revenue was attributable to
improved freight rates in petroleum business, commencement of finance lease of
FPSO Cendor and higher earning days in LNG business. However, the chemical
business recorded lower revenue from a smaller fleet of operating vessels while
different phases of project construction caused a decline in heavy engineering
revenue. Group operating profit +19%, PBT +8% mainly from improved freight
rates in petroleum business, commence of finance lease of FPSO Cendor &
lower operating costs. Segmental, revenue from Energy Related Shipping (ERS)
was +1.5% mainly from improved freight rates while operating profit was +40%.
Revenue from the Other Energy Business (OEB) was +9% but recorded lower
operating profit by 17% due to lower revenue and additional cost incurred for
certain projects in heavy engineering in the current year. Qoq, revenue was
+5%, while PBT +101% due to gains on disposal of assets through finance lease
& higher share of profit of JVs & associates - Ahead, group performance
will continue to be underpinned by secured recurring income from long term
contracts in the LNG shipping business. However it will be challenging in the
O&G service segment, given the reduction in capex & opex by major oil
companies in a low oil price environment. Although the petroleum tanker segment
might benefit from the current low crude oil price environment, muted earnings
is expected from the division in FY15 as rates remain below breakeven level
(USD20,000- 22,000/day). Chemical tanker segment's recovery is expected to be
flattish. With 5 Puteri-class LNG vessels slated to go out of charter in the
next 3 years and significantly higher vessel deliveries expected in the coming
years, we expect the LNG earnings to be softer as older vessels look to secure
new LNG contracts with potentially lower rates than before; Trim into strength.
BARAKAH : announced that
its wholly-owned subsidiary, PBJV Group Sdn Bhd has received a Letter of Award
from PETRONAS Carigali Sdn Bhd (PCSB) for the provision of engineering,
procurement, fabrication, installation, commissioning and maintenance works of
pig trap system in Peninsular Malaysia, Sabah and Sarawak. Award is for the
duration from 23 January 2015 to 22 January 2018, with extension option of one
year. The pig trap system is essentially a facility to launch and receive pipe
inspection gauges ("PIG"), which are used to run through internal
section of pipelines from one end to the other end for inspection and
maintenance of pipelines. The total value of the Contract will depend on the
actual work orders to be issued by PCSB during the Contract period ; +ve,
contract expected to contribute positively towards the earnings and net assets
per share of Barakah Group. Orderbook remains strong at RM2.0b which will span
till 2018, with a bid-book of RM2.0b. Management guided that 85% of its bid-book
is predominantly overseas jobs in Saudi Arabia, Vietnam and Indonesia. On the
domestic front, management remains upbeat on securing more onshore pipeline
installation jobs, especially in Pengerang. Group is expecting OB replenishment
of RM400-500m worth of work orders in 2015 - Accumulate.
6) Market : We expect trading to remain cautious, as the
market may face some selling pressure ahead due to the uncertain economic
outlook. However, downside may be limited, supported by the stabilization of
crude price and strengthening of the Ringgit.