Stocks In Focus (27-03-2018)

(March 26): Based on corporate announcements and news flow today, stocks in focus for Tuesday (March 27) may include: Eduspec Holdings Bhd, Serba Dinamik Holdings Bhd, myNEWS Holdings Bhd, Vivocom Intl Holdings Bhd, Prolexus Bhd, Uchi Technologies Bhd, OSK Holdings Bhd, Sapura Energy Bhd, Progressive Impact Corp Bhd, UMW Holdings Bhd and MBM Resources Bhd.

Eduspec Holdings Bhd, which slipped into the red last year, expects to turn a profit in the current ending Sept 30, 2018 (FY18) as it puts more focus to promote its core science, technology, engineering and mathematics (STEM) education, as well as its Education Services to Parents (ESP) business.

Chief executive officer Lim Een Hong said the group will also implement cost-cutting measures across its business operations.

Serba Dinamik Holdings Bhd has formed a (JV) company with Junaco (T) Ltd for the construction of a chlor-alkali plant in Tanzania.

Serba Dinamik will hold a 25% stake in Sufini Holding Ltd while Junaco will hold the remaining 75%.

The JV will see SDIL being involved in the engineering, procurement, construction and commissioning works which are valued at RM295.26 million, and marks the group’s entry into the African continent.

myNEWS Holdings Bhd reported a flat net profit of RM6.34 million in its first financial quarter ended Jan 31, 2018 (1QFY18) from RM6.36 million a year ago, on higher operating expenses which rose 32.4% year-on-year.

Quarterly revenue, however, rose 18.2% to RM90.12 million from RM76.23 million in 1QFY17, on new store openings, better products mix and higher other operational income.

myNEWS said the higher operating expenses were in tandem with the increase in the number of outlets to 366 stores as at Jan 31, 2018 compared with 307 as at Jan 31, 2017.

On prospects, the convenience store chain operator said 2018 is a transformation year for the group as it steadfastly implements its strategies together with its Japanese partners to offer ready-to-eat food and bakery to offer better quality and product mix in its stores.

Vivocom Intl Holdings Bhd has teamed up with Shanghai Civil Engineering Group Co Ltd (CREC Shanghai) to explore opportunities in property development, mixed development, infrastructure, water treatment plant and other development projects.

Vivocom said its subsidiary Vivocom Enterprise Sdn Bhd (VESB) has entered into a Heads of Agreement (HoA) with CREC Shanghai for the purpose.

Vivocom said VESB will act as CREC Shanghai’s sole and exclusive project management consultant for all projects within . Once a project is determined, VESB will finance the cost and outlay by way of the internal funds and/or bank borrowings.

Prolexus Bhd’s net profit contracted 42.8% in its latest financial quarter due to lower sales, weaker and unrealised foreign exchange losses.

Prolexus said net profit for its second financial quarter ended Jan 31, 2018 (2QFY18) fell to RM4.37 million from RM7.65 million a year ago, due to unrealised foreign exchange loss of RM2.87 million.

Quarterly revenue also declined 21.8% to RM85.1 million, from RM108.88 million previously, due to lower sale orders received for its apparel division and the weakening of the US dollar, despite registering an improvement in its advertising business.

Its net profit for the first half of the year stood at RM6.72 million, down 52% from RM14.09 million a year ago. Cumulative revenue, meanwhile, fell 23.4% lower to RM150.44 million from RM196.4 million.

Uchi Technologies Bhd intends to return some of its idle cash pile to its shareholders. It proposes a capital repayment of 20 sen per share, which will utilise up to RM90.43 million of its cash coffer.

The Penang-based company is currently sitting on a net cash position of RM243.08 million, or 54 sen per share. Subsequent to the exercise, Uchi’s share capital will be reduced by more than half to between RM68.06 million and RM72.13 million, from RM157.55 million presently.

OSK Holdings Bhd is considering listing its cable business on the Main Board of the Hong Kong Stock Exchange.

The group said the proposed listing would unlock shareholders’ value in the cable business and provide transparent valuation benchmark for the same in Hong Kong.

Noting that the actual details of the proposed listing have yet to be determined at this juncture, OSK Holdings said it is envisaged that the group will undertake a reorganisation of its subsidiaries involved in the cable business.

It added that the subsidiaries will remain as subsidiaries of OSK Holdings upon the completion of the proposed listing.

Sapura Energy Bhd today announced additional new deals after bagging six contracts worth some RM3 billion since the beginning of the year.

The group said it has cemented its foray into New Zealand with a series of farm-in agreements to five offshore exploration permits in the oil and gas region of Taranaki Basin.

Wholly-owned subsidiary Sapura Exploration and Production (NZ) Sdn Bhd (Sapura E&P) has secured the New Zealand government’s approval for agreements with OMV New Zealand Ltd and Mitsui E&P Australia Pty Ltd.

Progressive Impact Corp Bhd is undertaking a health laboratory project in Jeddah, Saudi Arabia for 18 million riyal (RM18.74 million).

It said its wholly-owned unit Saudi Asma Solutions LLC has accepted a letter of award from the Jeddah Municipality to undertake the project for the duration of three years.

Separately, Progressive Impact said another wholly-owned unit Alam Sekitar Malaysia Sdn Bhd (ASMA) is being sued by Oval Engineering Sdn Bhd.

This came after ASMA failed to acquire a set of equipment from Oval Engineering despite a letter of understanding inked by the two companies to facilitate the supply and acquisition.

UMW Holdings Bhd has hit a snag in its proposed acquisition of MBM Resources Bhd as the latter’s shareholders have turned down its takeover offer.

Med-Bumikar Mara Sdn Bhd and its wholly-owned subsidiary, Central Shore Sdn Bhd (CSSB), have separately rejected the conditional offer made by UMW for their collective 50.07% equity interest in MBM Resources.

UMW said the its board intends to continue to engage Med-Bumikar, CSSB, their respective shareholders and key principals as it is of the opinion that the conditional offer is reasonable.

The group has therefore notified the parties of the extended validity of its offer to April 30 from March 28.

Source: The Edge Markets

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