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Scientex, Malaysia Smelting Corp, Eco World International, Pos Malaysia, AWC, Wong Engineering, Dufu, Selangor Properties, SCGM and Pan Malaysia.

September 21, 2018

KUALA LUMPUR (Sep 20): Based on corporate announcements and news flow today, stocks in focus for Friday (Sep 21) may include the following: Scientex Bhd, Malaysia Smelting Corp Bhd, Eco World International Bhd, Pos Malaysia Bhd, AWC Bhd, Wong Engineering Corp Bhd, Dufu Technology Corp Bhd, Selangor Properties Bhd, SCGM Bhd and Pan Malaysia Corp Bhd.

cientex Bhd reported a 22% rise in its fourth quarter net profit at RM88.29 million from RM72.13 million a year earlier, as revenue increased on better sales from its manufacturing division, including stretch film production.

Revenue increased to RM733.15 million in the fourth quarter ended July 31, 2018 (4QFY18) from RM646.07 million a year ago. For the full year, net profit rose to RM289.81 million from RM255.87 million, while revenue was higher at RM2.63 billion versus RM2.4 billion in FY17.

The increase in 4QFY18 revenue was contributed by better sales from the manufacturing division. Group operating profit amounted to RM108.2 million, an increase of 26.5% compared to RM85.5 million in the preceding year corresponding quarter.

The company has proposed a final dividend of 10 sen a share, raising full-year dividends to 20 sen a share.

Malaysia Smelting Corp Bhd (MSC) is leasing two pieces of land totalling 423 acres in Klian Intan, Perak, owned by Menteri Besar Inc (Perak) for dumping overburden, tailings and slime arising from ongoing tin-mining activities at its open-pit tin mine.

The initiative is part of the group’s overall effort to enhance its market position as one of the world’s largest producers of tin metal.

MSC’s wholly-owned subsidiary Rahman Hydraulic Tin Sdn Bhd has entered into a Memorandum of Understanding (MoU) with MB Inc to lease the two parcels of lands measuring 100 acres and 323 acres respectively, which are located adjacent to Rahman Hydraulic’s existing tin mining leases in Klian Intan.

MSC chief executive officer Datuk Dr Patrick Yong said the MoU will pave the way for the group to commence strategic negotiations on expanding its tin mining leases, as well as to undertake any other joint efforts with MB Inc.

Eco World International Bhd (EWI) has eked out its first quarterly profit since listing in 2015 amid a pick-up in property sales which has put the property developer on-track to achieving its target of RM3 billion sales in the current financial year.

EWI registered earnings of RM10.44 million in its third financial quarter ended July 31, 2018 (3QFY18), mainly on the back of recognition of revenue and profit of a completed joint venture project in the United Kingdom.

In the corresponding quarter last year, the group incurred a net loss of RM24.2 million.

EWI said the group was able to recognise RM36.4 million as its attributable share of results from its joint ventures as opposed to the share of loss of RM13.2 million in the previous year.

Pos Malaysia Bhd has accepted Commodity Murabahah Term Financing facilities of RM500 million from Maybank Islamic Bhd, the money to be used to finance the group’s investment in capital expansion programmes.

“The principal of the facilities shall be paid by 22 equal quarterly payments and one final payment for the remaining balance, to commence 18 months from the date of disbursement of the facilities,” the group said.

The facilities are expected to increase the gearing of the group from 0.24 times to 0.59 times.

AWC Bhd has filed a lawsuit against BUCG (M) Sdn Bhd for failing to settle RM2.06 million in outstanding payment for subcontract works of a project involving one block of serviced apartments and a 55-storey hotel on Jalan Conlay.

BUCG is the main contractor in the project for Tetuan Lumayan Indah Sdn Bhd. On Nov 14, 2012, BUCG had awarded a RM10.24 million contract to AWC’s wholly-owned subsidiary Qudotech Sdn Bhd to carry out and complete the whole plumbing services installation works of the project.

Qudotech, via its solicitors Messrs Muthu & Partners, has filed a writ of summons together with the statement of claim against BUCG.

“The circumstances leading to the filing of the writ and statement of claim is based on Qudotech’s contention that BUCG had breached the terms of the letter of award in view that it failed to settle the unpaid portion of the debt of RM2.06 million even though Qudotech had issued a letter of demand dated July 20 and thereafter another letter via its solicitors to BUCG claiming for said outstanding payment.”

Wong Engineering Corp Bhd (WEC) has proposed a 1-for-4 bonus amid a 47.46% drop in net profit for the third financial quarter ended July 31, 2018 (3QFY18), but a doubling of earnings for the cumulative nine months.

The company proposes to undertake a bonus issue of up to 22.92 million shares, which will be wholly capitalised from the share premium account of the company.

This will involve between RM11.42 million and RM11.46 million being capitalised, leaving the group with a remaining share premium of between RM650,000 and RM604,000, the company said in a stock exchange filing.

WEC announced a net profit of RM1.6 million in 3QFY18 from RM3.05 million in the previous corresponding quarter, owing to a variation in product mix within the manufacturing segment and higher input costs.

US dollar exchange rates were also less favourable compared with rates during the corresponding quarter last year.

However, revenue spiked 55.11% year-on-year to RM18.4 million from RM11.86 million, contributed by domestic sales from manufacturing as well as construction and property segments.

Dufu Technology Corp Bhd, whose share price has more than doubled since mid-July, has proposed a one-for-two bonus issue involving the issuance of up to 87.74 million bonus shares, to enhance the marketability and trading liquidity of its shares.

The group’s issued share capital will remain at RM87.74 million after the exercise, while the number of issued shares will increase to up to 263.21 million shares. The group expects the proposal to be completed by the fourth quarter of 2018.

Selangor Properties Bhd’s net profit surged 70.2% to RM33.2 million in the third financial quarter ended July 31, 2018 (3QFY18) from RM19.51 million a year ago, mainly due to higher foreign exchange (forex) gains of RM16.3 million.

Earnings per share rose to 9.66 sen from 5.68 sen in 3QFY17.

Revenue grew 23.5% to RM39.36 million from RM31.86 million in 3QFY17, mainly due to higher contribution from its Australian operations and higher property development revenue achieved in Malaysia.

SCGM Bhd’s net profit slumped 81% to RM1.06 million or 0.55 sen a share in the first quarter ended July 31, 2018 (1QFY19), from RM5.59 million or 3.85 sen a share last year, due to higher expenses incurred in the quarter.

SCGM attributed the lower earnings to higher resin prices, finance costs, electricity costs, depreciation charges, labour costs and foreign exchange losses.

This was despite posting its highest quarterly revenue of RM55.81 million – up 4% from RM53.66 million a year ago – on higher local sales of plastic packaging products.

The group declared a first interim dividend of 0.5 sen per share for the financial year ending April 30, 2019 (FY19), payable on Oct 25.

SCGM said it is targeting new export markets as the group’s production capacity is set to increase with the commissioning of the new Kulai factory in December 2018.

Inclusive of the Klang Valley plant, the new Kulai plant will increase the group’s extrusion capacity by 64.9% to 67.6 million kg per year, from 41 million.

Pan Malaysia Corp Bhd is partnering with a Singaporean artisan baker and food store, Baker & Cook Pte Ltd, to diversify its business to include food and beverage (F&B) retail outlets.

Its wholly-owned unit Megafort Sdn Bhd entered into an agreement with Baker & Cook today to form a joint-venture (JV) company on a 50:50 basis.

The JV company will carry on the franchise business of retail F&B outlets operated and conducted under the trade names of “Baker & Cook” and “Plank Sourdough Pizza”.

Baker & Cook and Megafort will inject RM750,000 to subscribe for 50,000 shares each in the JV company.

While Baker & Cook will be managing the day-to-day operations, Megafort will be handling concession and sub-franchisee agreements for the business to be operated at Metrojaya Mid Valley Megamall and Corus Hotel Kuala Lumpur.

Source: The Edge Markets