Monday, August 28th, 2017

 

Prolexus’ plan to build Vietnam plant delayed

PETALING JAYA: Prolexus Bhd’s plan to build an apparel factory in Vietnam as part of its expansion drive has been delayed, according to a source.

It was stated in Prolexus’ circular dated May 20, 2016 relating to its rights issue that the plant would be completed and fully commissioned by the third quarter of this year, with an initial production capacity of about 4.5 million pieces a year.

The source told SunBiz the delay is due to some changes in the architecture design, which hindered the group from obtaining a construction permit.

Prolexus did not respond to queries as at press time, citing the group’s disclosure policy.

Proceeds from the rights issue are to be utilised for the specified reasons within 24 months of the completion of the exercise. The rights issue was completed in June 2016.

The Vietnam plant was to have been financed with the rights issue that raised up to RM62.53 million. The plant was to allow the group to take advantage of the generally lower cost of production as well as the availability of a larger pool of labour force.

In its 2016 annual report, Prolexus said it had secured the lease of two parcels of industrial land measuring 61,950 square metres in Long Jiang Industrial Park, Tien Giang Province, Vietnam.

The initial phase of this apparel factory was expected to be commissioned in the second half of 2017. However, no update has been reported as yet on the progress of work on the plant.

Besides being used for the Vietnam plant, part of the proceeds from the rights issue were also earmarked for the setting up of a new fabric mill in Kluang, Johor, in a bid to expand into upstream fabric production.

The rights issue was undertaken on the basis of one rights share for every existing Prolexus share held, together with one warrant for every two existing shares held.

According to Prolexus’ website, it has three manufacturing plants in Malaysia and China.

Prolexus’ apparel retailing business has it own brands under Be Elementz and Bixiz Kids. Its products are exported to international markets, including Australia, and countries in North America, the European Union and Asia.

For the third quarter ended April 30, 2017, Prolexus reported a 53.9% slump in net profit to RM1.59 million from RM3.45 million in the previous corresponding period, due to lower contribution from the apparel division. This brought its nine-month net profit to RM15.68 million, 13.8% lower than the RM18.2 million previously.

Prolexus’ share price closed up 3 sen at RM1.20 on 128,100 shares done yesterday, giving the company a market capitalisation of RM208.4 million.


MMC Corp upbeat on outlook despite lower Q2 earnings

PETALING JAYA: MMC Corp Bhd’s net profit declined 49.7% to RM62.92 million for the second quarter ended June 30, 2017 compared with RM125.02 million in the previous corresponding period, mainly on the absence of gain on land sale, substantial completion of MRT Line 1 project and lower contribution due to outages at Tanjung Bin Energy power plant.
Revenue was flat at RM944.43 million against RM950.26 million in the same period a year ago.

The group told Bursa Malaysia that it remains positive of its prospects, driven by stable performances of its operating companies together with contribution from ongoing construction projects.

The ports and logistics division is expected to register higher revenue across all the ports. With the completion of the acquisition of a 49% stake in Penang Port Sdn Bhd (PPSB) and the proposed acquisition if the remaining 51% equity interest will contribute positively to the group’s future earnings as it allows full consolidation of PPSB as a wholly owned subsidiary.

Meanwhile, the energy and utilities division will continue to see positive contribution from the group’s associate companies, Malakoff Corp Bhd and Gas Malaysia Bhd.

MMC said its substantial existing order book provides earnings visibility for the engineering and construction division, anchored by the MRT Line 2 underground work and project delivery partner (PDP) role for elevated portions.

“Furthermore, the earnings contribution from engineering and construction division will be sustained by ongoing projects, namely Langat 2 water treatment plant, Langat centralised sewerage treatment project and our involvement in the PDP role for Pan Borneo Sabah Highway,” it added.

MMC’s net profit went down 33.1% from RM176.36 million to RM118.06 million on the back of a 0.9% drop in revenue from RM1.89 billion to RM1.87 billion.

MMC gained five sen to RM2.38 yesterday on 115,400 shares done, giving the company a market capitalisation of RM7.25 billion.


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Scomi: No new risks from merger exercise

PETALING JAYA: Scomi Group Bhd does not foresee its proposed merger with Scomi Energy Services Bhd (SESB) and Scomi Engineering Bhd (SEB) to give rise to new risks which Scomi is not already exposed to.

In response to query by Bursa Malaysia, Scomi said this is because the group currently owns 65.65% of SESB and 72.33% of SEB.

However, Scomi said SESB’s businesses correlate with the conditions within the oil and gas industry, notably the level of activity in the exploration, drilling, development and production of oil and natural gas, which may be affected by factors beyond the group’s control, in particular fluctuations in oil and gas prices.

“Taking into consideration the challenging external environment, the group continues to explore to remain capital expenditure and asset light, and streamline operations across its businesses. Nevertheless, there can be no assurance that the protracted period of low drilling and production activities will not have a material and adverse effect on the businesses, financial position, results of operations and prospects of the group,” it noted.

SESB and SEB have business presence in several countries including Malaysia, Indonesia, Turkmenistan, Russia, Pakistan, Oman, Nigeria, India and Australia.

Scomi also highlighted that its exposure to credit risk arises principally from loans and advances to its subsidiaries, and financial guarantees given to banks for credit facilities granted to its subsidiaries.

“The subsidiaries, including SESB and SEB, in turn face credit risk in the event a customer or counterparty to a financial instrument fails to meet its contractual obligations,” it said.

As at March 31, 2017, SESB and SEB held a significant balance of trade receivables amounting to RM710.4 million and RM183.0 million respectively.

With crude oil price hovering at the range of between US$40 and US$60 per barrel, Scomi said there seems to be a gradual increase in capital expenditure by oil and gas majors and national oil companies.

“With this development, the prospects of the SESB are expected to be positive moving forward with possible increased drilling activities in the global oil and gas sector, barring any major geo-political developments,” it noted.

For SEB, it foresees opportunities fueled by growth in demand for mass public transportation and rising urban population across the world, notably in developing countries.

Scomi and SEB shares closed unchanged at 12 sen and 25.2 sen respectively today, while SESB’s shares closed half a sen lower at 10 sen.


3 firms team up to develop digital platform for Syarikat Perumahan Negara

PETALING JAYA: mTouche Technology Bhd, MNC Wireless Bhd and SPNB Dana Sdn Bhd, are teaming up to develop a digital technology platform for SPNB and provide financial support to home buyers in the affordable housing category.

SPNB Dana is a subsidiary of Syarikat Perumahan Negara Berhad (SPNB), which in turn is wholly owned by Minister of Finance Inc.

Under an agreement signed between SPNB and MNC Wireless last Friday, the two will form an equity joint venture company to provide financial support to home buyers of SPNB’s affordable housing project, with the appointment of MNC Wireless as SPNB Dana’s digital technology solution partner.

mTouche will work with MNC Wireless to jointly develop the digital platform for SPNB Dana.

The digital platform will comprise a business-to-business focused platform for companies operating within SPNB and business partners; and a business-to-consumer focused platform for home buyers of affordable housing projects by SPNB.

“This is a very important milestone for mTouche and we are excited to be given the opportunity to work with MNC Wireless to jointly develop the digital platform for SPNB Dana. Our digital media and infotainment platform core engine with payment solutions, digital display panel supports and broadcasting solutions, is designed with artificial intelligence capability and will play an increasing key role in developing and optimising our clients digital platform solution across the board and providing quantifiable value-added services to our enterprise partner,” mTouche executive director Tang Boon Koon said in a statement.

MNC Wireless CEO Christopher Tan said, “The equity joint venture company to be formed with SPNB Dana, will allow SPNB to provide financial support for its project’s home buyers, coupled with supporting SPNB’s digital transformation road map.”

ACE Market listed mTouche and MNC Wireless are expecting the collaborative partnership to contribute positively to their business, and is hopeful that the strategic partnership will drive each others revenues.


3 local firms team up for digital platform

PETALING JAYA: mTouche Technology Bhd, MNC Wireless Bhd and SPNB Dana Sdn Bhd, are teaming up to develop a digital technology platform for SPNB and provide financial support to home buyers in the affordable housing category.

SPNB Dana is a subsidiary of Syarikat Perumahan Negara Berhad (SPNB), which in turn is wholly owned by Minister of Finance Inc.

Under an agreement signed between SPNB and MNC Wireless last Friday, the two will form an equity joint venture company to provide financial support to home buyers of SPNB’s affordable housing project, with the appointment of MNC Wireless as SPNB Dana’s digital technology solution partner.

mTouche will work with MNC Wireless to jointly develop the digital platform for SPNB Dana.

The digital platform will comprise a business-to-business focused platform for companies operating within SPNB and business partners; and a business-to-consumer focused platform for home buyers of affordable housing projects by SPNB.

“This is a very important milestone for mTouche and we are excited to be given the opportunity to work with MNC Wireless to jointly develop the digital platform for SPNB Dana. Our digital media and infotainment platform core engine with payment solutions, digital display panel supports and broadcasting solutions, is designed with artificial intelligence capability and will play an increasing key role in developing and optimising our clients digital platform solution across the board and providing quantifiable value-added services to our enterprise partner,” mTouche executive director Tang Boon Koon said in a statement.

MNC Wireless CEO Christopher Tan said, “The equity joint venture company to be formed with SPNB Dana, will allow SPNB to provide financial support for its project’s home buyers, coupled with supporting SPNB’s digital transformation road map.”

ACE Market listed mTouche and MNC Wireless are expecting the collaborative partnership to contribute positively to their business, and is hopeful that the strategic partnership will drive each others revenues.


Puncak Niaga’s Q2 net loss widens on higher operating cost

PETALING JAYA: Puncak Niaga Holdings Bhd’s net losses widened in the second quarter ended June 30, to RM30.38 million from RM18.26 million a year ago, due to higher operating cost.

This was despite contributions from its construction and water and wastewater segments, driving revenue to more than double in the quarter under review to RM29.63 million, from RM10.36 million in the preceding year’s corresponding quarter.

“The group is continuously looking to expand its operations in areas related to its core businesses and competencies in the water and wastewater, sewerage, environmental engineering and construction, both locally and abroad as well as exploring opportunities in new business sectors such as oil palm plantation and property development,’ its board of directors announced in a Bursa Malaysia filing.

It had on July 3, ventured into the oil palm segment through the acquisition of oil palm company Danum Sinar Sdn Bhd. The board is of view the acquisition will contribute positively to its long term earnings while also threading cautiously in managing the various challenges in the oil palm plantation sector such as fluctuations in crude palm oil prices, labour shortage and weather conditions.

However, it displayed a cautious outlook in the oil and gas sector, where it has continued to mitigate the identified risks.

“Nevertheless, the group remains open to future possibilities and opportunities which may be worthwhile to be considered should there be a rebound in the crude oil price,” the board said.

For the first six months of the current financial year, Puncak Niaga’s net losses widened to RM73.10 million from RM63.80 million last year.

Revenue increased by 118% to RM 49.94 million from RM23.45 million.

Puncak Niaga’s shares were untraded at 77.5 sen.


China Ouhua Winery posts smaller loss on lower fees

PETALING JAYA: China Ouhua Winery Holdings Ltd narrowed its net loss to RM930,000 for the second quarter ended June 30, 2017 against RM2.07 million in the previous corresponding period, due to reduction in marketing and distribution fees.

Its revenue soared 61.9% from RM1.11 million to RM1.79 million.

The group’s first-half net loss also narrowed from RM4.83 million to RM1.92 million on the back of a 1.9% rise in revenue from RM2.42 million to RM2.47 million.

China Ouhua told the stock exchange that for the first half, domestic wine production continued to decline and at the same time imported wine showed growth momentum.

“The company will continue its proactive marketing activities by making sales calls and provide quality customer services to long-term loyal customers. In the meantime, the group will continue to look for viable projects and feasible opportunities for the benefit of the shareholders,” it said.


China’s company to conduct feasibility studies in various fields in Sarawak

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