Monday, March 19th, 2018


Cambridge Analytica: Firm at the heart of Facebook scandal

LONDON, March 19 — At the centre of a scandal over alleged misuse of Facebook users’ personal data, Cambridge Analytica is a communications firm hired by those behind Donald Trump’s successful US presidential bid. An affiliate of British…

Nasdaq drops 1pc as Facebook leads slide in tech stocks

NEW YORK, March 19 — US stocks fell today, with the Nasdaq dropping more than 1 per cent, as Facebook’s shares tumbled about 5 per cent on reports that data of 50 million users were misused. Facebook shares dropped, on track for their worst…

AirAsia in talks to set up airline serving Myanmar

HONG KONG: AirAsia Bhd is in talks with a potential partner to open an airline serving Myanmar, in a move that would help the low-cost carrier cover up to 95% of the Southeast Asian travel market.

In an interview with Reuters today, the airline’s group chief executive Tan Sri Tony Fernandes said he also expected AirAsia’s Vietnam joint venture to be flying by October.

AirAsia now has businesses in Malaysia – its home – along with India, Indonesia, the Philippines, Japan and Thailand, as well as plans to launch an airline in China.

“Once you’ve covered Vietnam and Myanmar, you’ve got all the big (Southeast Asian) populations,” Fernandes said. “Vietnam – we’re talking about October, we’ve had great support from the Vietnam government and we have a great partner. My team are very bullish.

“It’s not going to be a big airline there (Myanmar), because the airport infrastructure is not there. But it is 50 million people and it will develop over time,” said Fernandes, who was in Sydney over the weekend for the Asean-Australia special summit.

He added: “We had a good meeting with someone in Sydney – he’s got a good airline that we’ve known for a long time and he is a well-respected guy. We’re going through that process.”

He did not name the potential partner.

Fernandes was in Hong Kong for the launch of what he has termed a “We’re More Than an Airline” pitch, which he was due to present to analysts and investors at Credit Suisse’s Asia Investment Conference.

Qatar awards giant gas field contract to Japan’s Chiyoda

DOHA, March 19 — Qatar Petroleum aims to boost Doha’s gas production by more than 20 per cent with a contract awarded to Japanese Chiyoda, the state-owned energy giant said today. Chiyoda will “execute the Front End Engineering and Design…

It’s business as usual at Sa Sa Malaysia

PETALING JAYA: Cosmetics retailer Sa Sa may have seen the closure of its Taiwan operations recently, but the move is not expected to affect the Malaysian business under Hong Kong Sa Sa (M) Sdn Bhd (Sa Sa Malaysia), said Sa Sa regional general manager for Malaysia & Singapore business Lisa Soon.   

“Sa Sa Malaysia is operating a total of 75 stores in Malaysia and still has plans of expanding our network nationwide in providing the best offerings of beauty products and brands internationally to our shoppers,” Soon told SunBiz in an email reply.

Last month, its Hong Kong-listed parent Sa Sa International Holdings Ltd announced that it will close all its stores in Taiwan by March 31, 2018 after six consecutive years of losses, affecting 260 employees.

With the closing of its loss-making operations in Taiwan, the group said it will concentrate on its other markets including mainland China, Hong Kong, Macau, Singapore and Malaysia markets as well as its e-commerce business.

As at Jan 31, 2018, the retail network of Sa Sa consists of Hong Kong & Macau (118 stores), mainland China (55 stores), Singapore (19 stores), Malaysia (75 stores) and Taiwan (21 stores), all of which are solely owned and operated by the group.

Established in 1978, the cosmetics retailing group opened its first store in Malaysia in 1998.

According to Sa Sa International’s interim report 2017/2018 (six months ended Sept 30, 2017), the turnover for the Malaysian operations was HK$169.3 million (RM84 million), an increase of 9.2% in local currency terms over the previous period. Same-store sales growth rose a modest 1.1% in local currency.

It noted that the reason for the conspicuous slowdown in same-store sales growth was weaker demand and purchasing power of local consumers amid the rising cost of living as a result of inflation. However, the group maintained its focus on continuous improvement with a readiness to capitalise on market recovery as and when opportunities arise.

For the six months ended Sept 30, 2017, the Malaysian market contributed 4.6% of the group’s total turnover. The bulk of Sa Sa’s turnover comes from Hong Kong & Macau (81.5%), while the rest are from e-commerce (4.9%), mainland China (3.8%), Singapore (2.7%) and Taiwan (2.5%).

Filings by Sa Sa Malaysia showed it posted a profit after tax of RM6.09 million for the financial year ended March 31, 2017, with revenue of RM181.52 million.

In Malaysia, Sa Sa said it is the leading beauty specialty store in terms of number of stores and coverage. In recent times consumer sentiment has shown signs of a slowdown, necessitating a “comparatively conservative development strategy”.

Sa Sa will continue to adjust its product portfolio and services to accelerate its penetration of the Malaysian market, it said.

Adopting a “one-stop cosmetics specialty store” concept, Sa Sa sells more than 700 brands of skincare, fragrance, make-up and hair care, body care products, health and beauty supplements including own-brands and exclusive products. The group’s e-commerce arm provides online shopping service to customers. 

On its business strategy, the group said with its global purchasing and sourcing capabilities, often buying in large quantities to increase bargaining power, Sa Sa manages to offer a wide selection of quality products at competitive prices. Its market leadership reflects its innovative retailing formula based on choice and convenience, it added.

The group, which had a total workforce of around 5,000 employees as at Sept 30, 2017, considers employee training as crucial to the continued success of its operations and business expansion.

Alibaba to invest US$2 billion more in Lazada

BEIJING/SINGAPORE: Alibaba Group Holding Ltd said it will invest an extra US$2 billion (RM7.8 billion) in Southeast Asian e-commerce firm Lazada Group and tapped a top executive to run the business, as it takes on rivals such as tech titan Amazon in an aggressive expansion in the region.

One of the 18 founders of Alibaba, long-time executive Lucy Peng will take over as Lazada’s chief executive, replacing founder Max Bittner who will become a senior adviser to Alibaba.

Alibaba’s stake will increase to an undisclosed size following the latest investment, a spokesman told Reuters. It held an 83% stake prior to the investment, which now totals US$4 billion after a US$2 billion infusion over the past two years.

“The investment underscores Alibaba’s confidence in the future success of Lazada’s business and the growth prospect of the Southeast Asian market, a region that is a key part of Alibaba’s global growth strategy,” Alibaba said in a statement.

Backed by large cash piles and soaring stock prices, Alibaba’s new funding in loss-making Lazada underlines an ambitious global push to secure a bigger share of the fast-growing multi-billion dollar e-commerce market.

It follows a year of brisk expansion in Southeast Asia by the Chinese e-commerce giant and its payment affiliate Ant Financial, as it faces off against the world’s biggest online retailer Inc and fellow Chinese retailer Inc to tap new consumers in the region.

“With a young population, high mobile penetration and just 3% of the region’s retail sales currently conducted online, we feel very confident to double down on Southeast Asia,” said Peng, who is also executive chair at Ant Financial.

Alibaba operates in more than 200 countries and has more than 500 million people using its shopping apps every month, allowing Lazada to tap more of the e-commerce giant’s resources.

Rival firms are already ploughing billions of dollars building extensive logistics infrastructure in the region.

Consultancy Frost & Sullivan forecast total gross merchandise value of Southeast Asia e-commerce to rise to US$65.5 billion in 2021 from US$20.5 billion last year.
Singapore state investor Temasek Holdings and Lazada management are the only other stakeholders in Lazada. Launched in 2012, Lazada operates in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

US$1 billion bridging loan for Petronas Chemicals

PETALING JAYA: Petronas Chemicals Group Bhd has executed a bridging loan agreement of US$1 billion (RM3.9 billion) with external lenders comprising local and international banks, being one of the conditions for the divestment of its 50% stake in PRPC Polymers Sdn Bhd to Saudi Arabian Oil Co (Saudi Aramco).

In a filing with Bursa Malaysia today, Petronas Chemicals said the bridging loan will be used to finance part of the costs to develop, construct, commission and operate polymers and glycol plants. The plants are under construction in Pengerang, Johor, and are expected to be completed in 2019.

The bridging loan has a tenure of 12 months with an extension of six months at the discretion of PRPC Polymers. It is expected to be repaid once long-term project financing is secured at a later date.

The lenders have requested that Petronas and Saudi Aramco provide corporate guarantees on a several, not joint, basis as security.

In view of the corporate guarantee provided by Petronas to the bridge loan lenders, Petronas Chemicals has entered into a back-to-back guarantee arrangement through a binding letter of undertaking issued by Petronas.

On Bursa Malaysia today, Petronas Chemicals closed unchanged at RM8.15 on volume of 5.7 million shares.

SME Corp to organise HUB 2018 to boost cashless transactions

KUALA LUMPUR, March 18 — SME Corporation Malaysia (SME Corp) will be organising the first Bumiputera Entrepreneurs Gathering 2018 (Hub 2018) carnival, to be held March 30-31, 2018. The event aims to encourage Bumiputera entrepreneurs to adopt…

Battle for GKN heats up as Melrose, Dana sweeten deals

LONDON, March 19 — The battle for British engineering company GKN intensified today, with both Melrose and Dana sweetening their proposals before a March 29 takeover deadline. Melrose offered to inject about £1 billion (RM5.5 billion) into…

Facebook shares slide after reports of data misuse

NEW YORK, March 19 — Facebook Inc’s shares fell more than 4 per cent in premarket trading after media reports that a political consultancy that worked on President Donald Trump’s campaign gained inappropriate access to data on 50 million…