Tuesday, August 29th, 2017

 

Tadmax’s net loss widens in Q2 on marketing and energy expense

PETALING JAYA: Tadmax Resources Bhd's net loss widened in the second quarter ended June 30 to RM5.90 million from RM2.85 million in the same quarter last year, mainly due to the RM6 million marketing expense for its newly launched Mizumi Residence condominium project and expense for its energy business segment.

Revenue on the other hand more than doubled to RM26.24 million from RM9.63 million on the back of the progress made in its property development projects in Ganggarak, Labuan and the Mizumi Residence, which already has a 80% take up rate and has begun to recognise revenue.

“Barring unforeseen circumstances, the board expects the group to register losses in the current financial year considering the start up costs to be incurred by the Energy Business segment and that the revenue from the property development project known as Mizumi Residence low percentage completion envisaged with the initial commencement of the works at the project site) is impacted by substantial marketing cost that is expected to incur in the launching of the property development project,” its board of directors said.

It only expects to return to the black and sustain its profitability from 2018 onwards, as higher revenue is expected to be recognised from the progress achieved in the construction of the Mizumi Residence.

The group's board of directors said in a Bursa Malaysia filing, the slowdown in the property market is still manageable for Tadmax, which is focused in the residential property market.

Mizumi Residence is expected to contribute positively to its earnings in the next few financial years.

Meanwhile, its Energy sector is only set to contribute to earnings in the year 2022-2023.

Tadmax which has been awarded the contract to develop a 1,000 MW combined cycle gas-fired power plant in Pulau Indah, has submitted the conditional requirements to the commission for the project before the stipulated due date on August 1. In line with that its board said that the business segment is progressing well.

The group's net loss for the first six months of the financial year also widened to RM9.52 million from RM5.84 million.

Revenue on the other hand, increased by more than two fold to RM38.74 million from RM15.13 million.

Tadmax shares fell by 2.5% to close at 39sen with some 182,600 shares changing hands. Its market capitalisation stood at RM 209.88million.


Bursa Malaysia ends sharply lower

KUALA LUMPUR: Bursa Malaysia finished sharply lower today as the latest update on North Korea-US sent shock waves through the market.

At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) fell by 8.35 points, or 0.42%, to 1,761.14 after moving between 1,756.92 and 1,767.23 throughout the day.

The index opened 2.62 points lower at 1,766.87 from yesterday's close of 1,769.49.

Market breadth was negative with losers beating gainers by 622 to 274, with 337 counters unchanged, 591 untraded and 58 others were suspended.

Volume fell for the second day to 1.45 billion worth RM1.83 billion from 1.78 billion worth RM1.65 billion on Monday.

Inter-Pacific Securities Sdn Bhd Head of Research, Pong Teng Siew, said markets across Asia held back due to the latest development between the US and North Korea.

“It is a bad time for the stock market as it is wary of (the potential of war) … they worried about the actual military action that might be taken,” he told Bernama.

Earlier, a North Korean missile fired over the northern island of Hokkaido, Japan and broke into three pieces before falling into the Pacific Ocean.

Later today, US President Donald Trump and Japan Prime Minister Shinzo Abe vowed to increase pressures on North Korea.

It was reported that both leaders agreed to call for an emergency meeting of the United Nation Security Council to discuss the situation.

Most of the heavyweights were traded in the red with Maybank leading the list.

It fell 14 sen to RM9.46, CIMB erased eight sen to RM5.91, Sime dropped nine sen to RM9 and PetGas eased three sen to RM18.34.

Of the losers, MPI declined 38 sen to RM13.70, AeonCR fell 36 sen to RM12.34, TimeCom erased 26 sen to RM9.40 while DLady and Panamy both eased two sen to RM59 and RM38.5, respectively.

The FBM Emas Index declined 69.81 points to 12,528.77, FBM Emas Syariah Index decreased 75.93 points to 12,702.41 and the FBMT 100 Index erased 64.97 points to 12,197.57.

The FBM 70 inched down 106.55 points to 14,953.58 and the FBM Ace was 93.69 points lower at 6,515.31.

Sector-wise, the Plantation Index fell 5.96 points to 7,835.90, Finance lost 133.60 points to 16,584.43 and the Industrial Index fell 20.34 points to 3,183.65.

Main Market volume fell to 888.69 million shares worth RM1.71 billion from 998.34 million shares worth RM1.49 billion previously.

Volume on the ACE Market declined to 402.40 million units valued at RM96.42 million from 559.69 million units valued at RM133.88 million on Monday.

Warrants decreased to 161.25 million shares worth RM23.46 million from 212.81 million shares worth RM27.24 million yesterday.

Consumer products accounted for 47.65 million shares traded on the Main Market, industrial products (186.23 million), construction (88.36 million), trade and services (360.72 million), technology (31.24 million), infrastructure (3.65 million), SPAC (170,300), finance (71.48 million), hotels (2.86 million), properties (66.66 million), plantations (14.40 million), mining (441,200), REITs (10.83 million), and closed/fund (7,800).

The physical price of gold as at 5pm stood at RM175.71 per gramme, up RM3.59 from RM172.12 at 5pm yesterday. — Bernama


Lower impairment losses boost RHB Bank’s Q2 earnings

PETALING JAYA: RHB Bank Bhd reported a 43.1% rise in net profit to RM500.96 million for the second quarter ended June 30, 2017 against RM350.17 million in the previous corresponding period, underpinned by lower impairment losses on loans and other assets.

Revenue, however, was flat at RM2.63 billion against RM2.65 billion in the same period a year ago.

The group has proposed to declare an interim dividend of 5 sen per share totaling RM200.5 million for the quarter under review, representing a dividend payout ratio of 20%.

For the first half of the year, RHB's net profit rose 9.4% from RM915.05 million to RM1 billion, on the back of a 2.1% drop in revenue from RM5.36 billion to RM5.25 billion.

The group said in a filing with the stock exchange that its gross loans and financing grew 3.2% and 1.4% for the first six months to RM156.6 billion. The increases were mainly from mortgages and SME, which recorded annualised growth rate of 12.2% and 7.1% respectively.

Compared with December 2016, its gross impaired loans declined slightly to RM3.6 billion, with gross impaired loans ratio improving to 2.29% from 2.43%.

As at 30 June 2017, RHB's common equity tier-1 and total capital ratio, taking into consideration the FY17 interim dividend, remained strong at 13.4% and 17.0% respectively. These capital ratios are well above the Basel III minimum transitional arrangement requirements of 5.75% and 9.25% respectively.

RHB expects the Malaysian banking sector to see signs of modest growth, underpinned by moderate increase in lending to household sector and recovery in business loans.

However, the group said a rebound in the capital market activities and the return of investors' interest are expected to contribute to an improved outlook for non-funding income.

“Despite the challenges in asset quality, first-half earnings and performance demonstrated our ability to capture opportunities across our businesses and effectively manage costs. As we move into the second half of the year, we see stronger pipeline in the investment banking front, and our balance sheet remains strong” said RHB Banking Group managing director Datuk Khairussaleh Ramli.

It said the group will continue to pursue growth in selective market segments while also effectively managing asset quality and enhancing productivity.

“The group expects to deliver a better performance this year and is on track to achieve its long term objectives,” it added.

At noon break, its shares were down by five sen to RM5.00 on some 625,000 shares done, giving it a market capitalisation of RM20.05 billion.


AirAsia to add 23 planes to group fleet

  KUALA LUMPUR: AirAsia Bhd will add a further 23 planes to the group fleet in the second half of the year and is gearing up to expand the number to 500 by 2027. This will entail adding 30 new aircraft annually for the next decade. “I’m confident that we can reach this target or even exceed it, especially with the setting up […]


Indonesia reaches agreement with Freeport on new mining permit

JAKARTA, Aug 29 — Indonesia and Freeport-McMoRan Inc today reached an agreement that lets the US miner continue operating its giant Grasberg copper and gold mine, though crucial details on a planned 51 per cent divestment and new taxes remain…


Up close with Ng Keng Hooi, who makes us proud to be Malaysians

KUALA LUMPUR, Aug 29 — As we celebrate the 60th anniversary of Merdeka, let us be fired up and inspired by the story of Ng Keng Hooi, little known in his own home country, Malaysia, but a big name in the world of life insurance. He made…


Companies with as little as RM10m debt issues can apply for CDRC’s help from Sept 1

PETALING JAYA: The Corporate Debt Restructuring Committee (CDRC), under the auspice of Bank Negara Malaysia (BNM), is opening up its debt resolution services to companies with as little as RM10 million total outstanding debt, to encompass a wider group of small and medium businesses from Sept 1.

Companies currently qualify for debt resolution mediation for total outstanding debt of at least RM30 million.

“In particular, the revision will expand the services of the CDRC to cover mid-sized companies facing temporary operational challenges. This proactive measure will complement the existing dedicated remedial and recovery resources of financial institutions to assist viable borrowers, ” it said in a statement today.

The CDRC was re-established in 2009 as a pre-emptive measure by BNM to provide a platform for viable corporate borrowers and their multiple financial creditors to work out feasible and market-driven debt resolutions through mediation without having to resort to lengthy and costly legal proceedings.

This mechanism aims to: (i) support balance sheet and cash flow restoration whilst avoiding premature failure of viable borrowers; (ii) improve the speed and value of debt recovery; and (iii) minimise potential losses to financial institutions, which in turn preserves the continuity of the domestic financial intermediation process and economic activity. All applications to CDRC are done on a voluntary basis.


Companies with as little as RM10k debt issues can apply for Bank Negara’s help from Sept 1

PETALING JAYA: The Corporate Debt Restructuring Committee (CDRC), under the auspice of Bank Negara Malaysia (BNM), is opening up its debt resolution services to companies with as little as RM10,000 total outstanding debt, to encompass a wider group of small and medium businesses from Sept 1.

“In particular, the revision will expand the services of the CDRC to cover mid-sized companies facing temporary operational challenges. This proactive measure will complement the existing dedicated remedial and recovery resources of financial institutions to assist viable borrowers, ” it said in a statement today.

The CDRC was re-established in 2009 as a pre-emptive measure by BNM to provide a platform for viable corporate borrowers and their multiple financial creditors to work out feasible and market-driven debt resolutions through mediation without having to resort to lengthy and costly legal proceedings.

This mechanism aims to: (i) support balance sheet and cash flow restoration whilst avoiding premature failure of viable borrowers; (ii) improve the speed and value of debt recovery; and (iii) minimise potential losses to financial institutions, which in turn preserves the continuity of the domestic financial intermediation process and economic activity. All applications to CDRC are done on a voluntary basis.


Malaysia’s halal product exports to Japan rises to RM2.66b in 2016

KUANTAN, Aug 29 — Malaysia’s exports of halal products to Japan rose to RM2.66 billion in 2016 from RM2.20 billion in 2015, Deputy International Trade and Industry Minister Datuk Ahmad Maslan said. He said the export value is expected to…


Alliance Financial Group’s Q1 net profit up marginally

PETALING JAYA: Alliance Financial Group Bhd's net profit for the first quarter ended June 30, 2017 rose marginally to RM135.00 million from RM132.47 million a year ago, due client-based fee income and net financing income.

In a filing with Bursa Malaysia, the group said its pre-provision operating profit improved by 7.9% year-on-year to RM210.2 million.

Revenue for the quarter rose 6.27% to RM386.61 million from RM363.81 million a year ago, due to higher net interest income inclusive of Islamic banking income, which grew 5.7%.

The higher Islamic banking income was due to expansion of total gross loans and investments portfolios. Net interest margin stood at 232bps.

During the quarter, other operating income improved by 8.1% mainly from higher brokerage fees, commission income and treasury income while operating expenses increased by 4.4% on higher personnel costs and administration expenses. Cost to income ratio stood at 45.6%.

Gross impaired loans ratio increased moderately to 1.1% while loan loss coverage stood at 122.1%. The current account/savings account (CASA) ratio improved to 35.3% from 34.8% a year ago. Loans-to-deposits ratio stood at 88.2% while loan-to-fund ratio stood at 84.3%.

The group's total capital ratio stood at 17.2%, with a Common Equity Tier 1 Capital ratio of 12.6% as at June 30, 2017.

The group's CEO Joel Kornreich said small and medium enterprises (SME) remained its best performing segment as it continued to focus on better risk adjusted returns and effective credit risk management measures.

Loans growth in the SME sector grew 9.7% year-on-year while gross impaired loans ratio stood at 1.4%. However, Kornreich noted that growth momentum has slowed due to the challenging environment.

“We continue to focus on growing customer based funding and optimise our deposit mix. The group recorded an improvement in core customer deposits, including CASA and fixed deposits, at an above-industry growth of 7.4% year-on-year. Liquidity remains healthy with liquidity coverage ratio at 143.7% and loan to fund ratio at 84.3% respectively. We saw a steady build-up in sales for our Alliance One Account value proposition,” he said.

Moving forward, the group will continue to leverage on its franchise strength to deliver sustainable profits and continue to improve balance sheet efficiency by focusing on better risk adjusted return loans, liquidity management and by mitigating credit risk.

“This year, we have launched a number of new and differentiated value propositions and will continue to scale them up for our customers. As increasing number of our customers are moving to digital channels, we will be investing in the required technology enablers to support the bank's strategic initiatives. We will also focus on streamlining to improve the efficiency of our operations,” said Kornreich.

The group's share price was down four sen to close at RM3.82 with some 327,400 shares done. It has a market capitalisation of RM5.8 billion.