Monday, August 19th, 2019


US stocks rise amid stimulus talk, steadying bond yields

NEW YORK, Aug 19 — The steadying of the US Treasury market and talk of economic stimulus in Germany and China helped lift Wall Street stocks early today. Yields on the 10-year US Treasury note were solidly higher, rising back above those for…

FGV: Most issues raised in NGOs’ petition to US Customs resolved

PETALING JAYA: FGV Holdings Bhd has clarified that most allegations in a petition submitted by a coalition of non-governmental organisations (NGOs) have been corrected over the period beginning December 2018.

The plantation giant said one major item – pertaining to the legalisation of foreign workers in Sabah, which requires engagement at government level and involves policy changes – is expected to be com-pleted by year-end.

FGV was responding to the petition dated Aug 15, 2019 and addressed to the Acting Commissioner for the United States Customs and Border Protection (CBP). There are several allegations made against FGV in the petition, citing a number of sources, including an article in The Wall Street Journal that was published on July 26, 2015.

“Regrettably, some of those allegations were indeed factually accurate at the time,” FGV said in a press releasetoday.

FGV said it will appoint independent third parties next month to audit and verify each of the newly appointed foreign worker recruitment agencies to ensure that they are in full compliance with FGV’s requirements.

The agreements with the independent third parties are being finalised and an announcement will be made at an appropriate time.

Earlier in March, FGV revised its foreign worker recruitment processes and appointed 13 new recruitment agencies for Indonesia and India. All these recruitment agencies were appointed through an open tender process.

It said each agency had been vetted through a stringent process and engaged under new contractual terms that included protection of the rights of foreign workers.

FGV also is in the process of engaging and appointing independent third-party assessors to audit and verify its grievance mechanism processes, independent third-party assessors to map the risks within its traceability protocols for oils produced by third party suppliers, including smallholders and estates, who account for 70% of the palm oil produced by FGV.

“A key element in addressing the issues that have been raised in the petition is the traceability of the fresh fruit bunches (FFB) supplied to FGV’s mills. At this time, FGV has 100% traceability to all our own estates and to all FFB produced by smallholders who are part of organised government schemes. This accounts for about 70% of the oil produced by FGV.

“Of the additional 30% or about one million tonnes of oil produced from plantations owned by independent smallholders and estates, FGV is now able to trace 66% of its FFB quantity to Tier 1 suppliers (estates of origin and collection centres). Thus, 86% of the oil produced by FGV’s mills is now fully traceable to Tier 1 suppliers,” explained FGV.

FGV said any supplier who does not comply with its requirements on labour standards, human rights and environmental sustainability will be terminated if they are unable to change their practices within a reasonable time frame.

FGV has 68 mills in Malaysia and an oil palm planted area of 339,385ha. Of this, 290,829ha is leased from the Federal Land Development Agency (Felda) and was developed as part of the national agricultural development

Audit firm, partners fined and suspended

KUALA LUMPUR: The Securities Com-mission Malaysia’s Audit Oversight Board (AOB) has fined Chengco PLT and its partners a total of RM276,000 and prohibited them from accepting public interest entities (PIEs) or schedule funds as clients and auditing their financial statements for 12 months, with effect from Aug 6.

The firm and its partners concerned were found to have multiple instances of non-compliance with the international auditing standards, which were discovered in two inspections in 2016 and 2018 respectively. The AOB noted that the firm had failed to remedy a recurring finding identified in the first inspection.

As a result, the firm and the partners, Hong Thuan Boon and Liew Kwai Choy, were prohibited from accepting PIEs or schedule funds as clients and auditing their financial statements for 12 months.

The firm was fined RM175,000 while Hong was fined RM57,000. Hong and Liew were engagement partner and engagement quality control reviewer respectively for the audit. Another of the firm’s partner, Yap Peng Boon, was also fined RM44,000 for non-compliance of audit procedures.

The firm, Hong, Liew and Yap appealed against the AOB’s decisions and the SC dismissed the appeal.

BToto posts RM975m revenue for May-June

PETALING JAYA: Berjaya Sports Toto Bhd (BToto) reported RM974.9 million in revenue for the two-month period ended June 30, 2019, substantially contributed by sales from the number forecast operation (NFO) business by Sports Toto Malaysia Sdn Bhd and also from the auto retailing business operated by HR Owen Plc.

However, it saw a loss before tax of RM26.8 million, mainly attributed to the impairment of goodwill and assets of the disposal group relating to the leasing of lottery equipment business in the Philippines.

“The group would have registered a pre-tax profit of RM51.6 million had the impairment of goodwill and assets of the disposal group been excluded,“ BToto said.

Due to the change of financial year end, the group’s performance of the current interim and cumulative period results are not comparable against the comparative period.

For the cumulative 14-month period, the group registered RM6.7 billion in revenue, mainly attributed to revenue from Sports Toto, HR Owen and Philippine Gaming Management Corporation (PGMC). PGMC is classified as discontinued operation in the current interim two-month and 14-month period ended June 30, 2019.

Meanwhile, its pre-tax profit came in at RM404 million.

BToto’s board does not recommend any interim dividend for the current two-month period, but the total dividend distribution for the financial period ended June 30, 2019 was about RM215.5 million, representing about 91.7% of the group’s attributable profit for the 14-month financial period.

BToto anticipates that the performance of the NFO business of Sports Toto will be satisfactory and is confident that the group will continue to maintain its market share in the NFO business for FY20.

SunCon posts RM33m Q2 profit, pays 3.5 sen dividend

KUALA LUMPUR: Sunway Construction Group Bhd’s (SunCon) net profit for the second quarter ended June 30, 2019 fell 7.2% to RM33.19 million from RM35.77 million a year ago, due to lower contribution from both the construction and precast segments.

Subsequently, the group’s revenue decreased by 19.1% to RM440.18 million compared with RM544.28 million previously.

SunCon proposed its first interim dividend of 3.5 sen per share for the financial year ending Dec 31, 2019 which is more than 60% payout from year-to-date profit after tax and minority interest.

For the six-month period, its net profit fell 10.3% to RM64.2 million from RM71.54 million, while revenue dropped 18% to RM880.21 million from RM1.07 billion last year.

SunCon’s outstanding order book as at June 2019 amounted to RM5.8 billion with a total of RM1.54 billion in new orders received to date, exceeding management’s target of new order book wins of RM1.5 billion within 1H2019 with job wins totaling RM1.54 billion.

Group managing director Chung Soo Kiong said the group is still pursuing various tenders locally and abroad to secure their first overseas job this year.

“We are positive about the outlook for the domestic construction sector as the RM44 billion East Coast Rail Link was revived. There are also opportunities within the sustainable energy sector such as in the development of Large Scale Solar Phase 3. We are expecting more projects to be announced in the next 12 months which was reflected with Bursa Malaysia’s FBM Construction Index gaining more than 40% since beginning of this year,” he said in a statement.

In addition to local prospects, Asean is also an exciting market which SunCon is exploring. In Myanmar, SunCon has teamed up with Capital Construction Ltd, the construction division of Capital Diamond Star Group and submitted a tender for mixed development project in Mandalay, Myanmar.

“We are also preparing to submit three bids in road infrastructure projects in India by end of this year or early next year. In Singapore, we have ventured into piling. SunCon is very hopeful to secure our first overseas project for the year,” he added.

Germany warns of possible recession, mulls stimulus

FRANKFURT, Aug 19 — The German economy could enter a recession in the third quarter, the Bundesbank warned today, as the debate on government measures to support the economy swelled in Berlin. “The economy could contract again slightly” this…

Bank of England chief pulls out of Chinese event

LONDON, Aug 19 — Bank of England governor Mark Carney has withdrawn from a high-profile business event with China’s ambassador to London, sources said today, as pro-democracy protests continue in Hong Kong. Carney had been due to speak at the…

Gas Malaysia net profit up to RM49m in Q2

KUALA LUMPUR, Aug 19 — Gas Malaysia Bhd’s net profit rose to RM49.01 million for the second quarter ended June 30, 2019 from RM48.07 million recorded in the same quarter a year ago. Revenue increased 15.5 per cent to RM1.74 billion from RM1.5…

Stock markets rally on fresh trade talks hopes

LONDON, Aug 19 — Stock markets rallied today after US President Donald Trump’s top economic adviser hailed “positive” trade talks with Chinese negotiators. “As the new week kicks off, stocks are in demand amid increased optimism over US…

Ringgit ends slightly higher

KUALA LUMPUR: The ringgit ended slightly higher against the US dollar today, tracking global cues on hopes that major economies will launch stimulus measures to counter a global economic slowdown.

At 6pm, the ringgit finished at 4.1750/1790 against the greenback from 4.1760/1810 on Friday.

Chief market strategist at FXTM Hussein Sayed said investors are counting on central banks to save the global economy and equity markets from further turbulence.

“If central banks prove they’re ready to act by delivering interest rate cuts and new quantitative easing programmes, expect equity markets to resume their rally after their recent plunge.

“Otherwise, expect more money to pour into gold and other safe havens such as the Japanese yen and Swiss franc,“ he added.

He said all eyes are on Thursday’s Jackson Hole annual meeting at Wyoming, where leaders from major central banks gather for more market clues amid the current volatile markets.

Against other major currencies, the ringgit was traded mixed.

The ringgit was better against the Japanese yen at 3.9183/9228 from 3.9230/9288 last Friday, and against the British pound at 5.0593/0645 from 5.0763/0828.

It weakened against the Singapore dollar to 3.0144/0184 from 3.0097/0140 last Friday and versus the the euro to 4.6338/6399 from 4.6283/6346. — Bernama