Friday, August 9th, 2019

 

TH Plantations’ CFO served with show-cause letter

KUALA LUMPUR, Aug 9 — TH Plantations Bhd’s (THP) chief financial officer (CFO), Mohamed Azman Shah Ishak has been served with a show-cause letter in relation to the findings arising from a recent forensic audit conducted by the company. In a…


I’m not afraid of a no-deal Brexit, says UK’s finance minister

LONDON, Aug 9 — Britain’s finance minister said today he wanted to clinch a sensible Brexit deal with the European Union but if that was not possible then he was not frightened by a no-deal exit. “If it comes to no deal, it’s not anything…


Sterling hits two-year low as shock GDP data adds to Brexit pain

LONDON, Aug 9 — Sterling skidded again today, hitting its weakest level since 2017 after an unexpected second quarter contraction in the economy alarmed investors already fretting that Britain is headed for a no-deal Brexit. The pound, which has…


Leong Hup sees lower profits in Q219 with lower ASP

PETALING JAYA: Leong Hup International Bhd expects the group to record significantly lower profits after taxation for the second quarter ended June 30, 2019 (Q219) in comparison with Q218 due to a significant decline in the average selling prices (ASP) in most of the products sold by the group, particularly in Malaysia.

The ASP of the group’s broiler day-old-chicks (DOC) in Malaysia in Q219 was RM1.21 per DOC, representing a decline of 38.6% from RM1.97 per DOC in Q218. The selling price of the group’s broiler DOC in Malaysia declined to as low as 90 sen per DOC in Q219. In comparison, the lowest selling price of the group’s broiler DOC in Q218 was RM1.60 per DOC.

The ASP of the group’s broiler chicken in Malaysia in Q219 was RM3.99 per kg, representing a decline of 14.7% from RM4.68 per kg in Q218. The selling price of the group’s broiler chicken in Malaysia declined to as low as RM2.60 per kg in Q219. In comparison, the lowest selling price of the group’s broiler chicken in Q218 was RM3.90 per kg.

Executive director and group CEO Tan Sri Lau Tuang Nguang (Francis Lau) said its sales volume is still growing well despite the lower ASP in Q2019.

“Wide price fluctuation is inherent in our industry, particularly in Malaysia. Given that the group’s operating costs are relatively stable, the weaker ASP in Q219 will affect the group’s margins and profitability. However, as at Aug 5, 2019, the market prices of broiler DOC and broiler chicken were RM2.00 per DOC and RM5.00 per kg respectively,” he said in a statement.

Leong Hup saw a growth in overall sales volumes across key product categories despite reporting lower ASP in Q219, including in livestock feed (+13.9% yoy), broiler DOC (+8.1%) and broiler chickens (+10.7%). In addition, total number of eggs sold increased in Q219 by 5.9% as compared to the corresponding period in 2018.

Despite the volume growth, the group’s profits were affected as a result of the significant decrease in the ASP.

Lau expects its sales volume growth to continue across key product categories and in most of the markets that it sells to.

“We will continue to execute our plans and strategies in all the five markets where we operate. We believe that the strength of our geographical diversification as a fully integrated producer of poultry, eggs and livestock feed, together with strict cost control policy will position us well for long term growth,” he added.

Meanwhile, Leong Hup’s listed unit Teo Seng Capital Bhd has clarified that eggs supplied to Tesco Malaysia by the company under the Tesco brand in Malaysia fully complied with the requirements of Department of Veterinary Services Malaysia.

“The chicken farms of the company are strictly operating under the guidelines on good farming practices including hygiene control, rearing process and health and safety of chickens,“ Teo Seng said in a stock exchange filing.

Teo Seng was responding to media reports that investigation by a non-profit animal protection organisation revealed filth, food safety risks and animal cruelty at the company that supplies eggs to Tesco.

Teo Seng said its chicken farms are also accredited by the Ministry of Agriculture and Agro-Based Industry Malaysia with Malaysian Good Agricultural Practice (myGAP) certificate to validate that its eggs are safe for consumption.

“The layer farming activity operating under the cage system is a common rearing system used in Malaysia which is different from European countries. The health and safety requirements of this system are not compromised,“ the company added.

The investigation was filmed last month by workers and students at farms operated by Teo Seng.


Hong Kong leader Carrie Lam says protests have hit business like a ‘tsunami’

HONG KONG, Aug 9 — Hong Kong’s leader Carrie Lam warned today that two months of pro-democracy demonstrations were causing economic chaos in the city but ruled out making concessions to “silence the violent protesters.” The embattled leader…


UK economy suffers shock pre-Brexit contraction in Q2, first since 2012

LONDON, Aug 9 — Britain’s economy shrank for the first time since 2012 in the second quarter, a severe hangover from a pre-Brexit stockpiling boost in early 2019 and one that bodes poorly as Prime Minister Boris Johnson gears up to leave the EU…


Turkish central bank dismisses chief economist, department managers

ANKARA, Aug 9 — Turkey's central bank has dismissed its chief economist, Hakan Kara, and some department managers, according to a document seen by Reuters, re-igniting concern about political interference in the institution one month after the…


Asia markets reverse gains as trade war fears persist

HONG KONG, Aug 9 — Asian markets largely reversed early gains today from a bargain-hunting push as investors remained cautious over the intensifying US-China trade war. Tokyo managed to hold on to its winnings as positive data helped drive the…


Leaner WPP announces profit slump but shares rally

LONDON, Aug 9 — British advertising giant WPP today said net profit slumped more than 50 per cent in the first half, as the company streamlines after the controversial exit of founder Martin Sorrell. Profit after tax slid 53.5 per cent to £312…


Cagamas issues RM825m bonds, sukuk

KUALA LUMPUR: Cagamas Bhd, the National Mortgage Corporation of Malaysia, today announced its combined issuances of conventional medium term notes (CMTN) and Islamic medium term notes (IMTN) totaling RM825 million.

The respective issuances comprised one-year RM800 million CMTN and one-year RM25 million IMTN. Proceeds from the issuances will be used to fund the purchase of housing loans and Islamic housing financing from the financial system.

President and CEO Datuk Chung Chee Leong (pix) said despite expectations for greater external risks arising from heightened volatility within the global markets due to further escalation in trade tension between US and China coupled with the Federal Reserve rate cuts, both CMTN and IMTN were successfully concluded at competitive pricing.

“The initial RM600 million CMTN which was conducted via public offering, received a commendable demand that allowed the company to upsize to RM800 million and tighten its pricing by 5 basis points from the high of the initial price guidance of 3.45% to 3.40%. The RM25 million IMTN were concluded via private placements and priced at the same level as the CMTN,” said Chung in a statement.

He added that the conclusion of the deal brings the company’s year-to-date issuance to RM4.6 billion.

The papers, which will be redeemed at their full nominal value upon maturity, are unsecured obligations of the company, ranking pari passu among themselves and with all other existing unsecured obligations of the company.