Wednesday, September 25th, 2019


Trump says trade deal with China could happen sooner than people think

NEW YORK, Sept 25 — US President Donald Trump said today that a deal to end a nearly 15-month trade war with China could happen sooner than people think. “They want to make a deal very badly… It could happen sooner than you think,” Trump…

Beijing opens glitzy airport ahead of China’s 70th anniversary

BEIJING, Sept 25 — A futuristic airport that resembles a giant starfish opened in Beijing today, as China unveils another massive infrastructure project just days before it celebrates 70 years of Communist Party rule. Located 46km south of…

Wall St ticks lower as Trump impeachment threat weighs

NEW YORK, Sept 25 — US stock indexes edged lower today as a move to launch an impeachment inquiry into President Donald Trump more than offset gains in shares of Nike and Philip Morris. The news on probe, which pushed the S&P 500 to post its…

Juul CEO steps down, Altria, Philip Morris end merger talks

WASHINGTON, Sept 25 — Crisis-stricken e-cigarette maker Juul announced a corporate shakeup today, swapping out its CEO for a tobacco industry veteran as the US legal environment rapidly darkened for the company’s main products. The company is…

CEO Wenig steps down as eBay mulls asset sales

SAN FRANCISCO, Sept 25 — Online commerce giant eBay said today that chief executive Devin Wenig was stepping down as the California firm considers strategic options including asset sales. No departure data was given for Wenig, who has held the CEO…

Business optimism to remain sluggish until Q1 2020, RAM survey shows

PETALING JAYA: Overall business optimism in Malaysia is expected to remain sluggish in the fourth quarter of this year and throughout the first quarter of 2020, according to the latest RAM Business Confidence Index (BCI).

The Corporate Index slipped 0.2 points to 53.2, while the SME Index rose 1.4 points to 53.2.

“Although the latest readings for corporates and SMEs converged at 53.2, we highlight that these two cohorts face different circumstances and prospects,” said the rating agency.

It noted that the greater optimism sentiment of the SMEs is driven by access to bank financing and improved performance indicators.

As SMEs’ performance is highly influenced by new orders and projects, their business prospects tend to be quite volatile.

Meanwhile, the persistently sluggish sentiment among corporates signals their view on the current economic environment, which has been plagued by uncertainties since the fourth quarter of the previous year.

“At the same time, US-China trade tensions have worsened, along with firmer signs of weaker global demand this year,” said RAM.

It pointed out that a higher proportion of firms (45.6% for surveyed corporates and 44.8% for SMEs), now cite “weak economic conditions” as their main challenge in the next six months.

The rating agency said the prolonged global uncertainties have also led to large swings in firms’ business performance expectations, underlining the challenges faced by their business operations.

“Previously a trait only observed among SMEs, corporates now also have yo-yoing expectations on their performance in 2019.”

It noted that the volatility is significantly stronger among export-oriented firms given their direct exposure to the US-China trade war.

From its interaction with selected respondents, firms indicated softer demand from China and local clients that service the Chinese market amid the impact from the US-China trade spat.

“Moreover, order sizes have shrunk and become lumpier as their clients have become more cautious in inventory management,” said the rating agency.

In turn, such uncertainties have affected corporates’ capacity-building intentions, which have undergone successive declines through most of 2018 and 2019.

However, the latest survey results have suggested that the earlier downtrend in capacity-building activities has been arrested, with improvement sighted in the last two surveys.

The survey found that the majority of firms are operating at normal capacity, with little sign of industrial slack as well as maintaining their headcount.

Meanwhile, SMEs’ better access to bank financing is another element that will support capacity-building and operations.

Released quarterly, the BCI is based on a survey of about 2,000 SMEs and corporates across five main SME and four main corporate industry segments.

Write-down, M&A costs tip Daibochi into net loss

PETALING JAYA: Daibochi Bhd saw a net loss of RM305,000 for the three-month period ended July 31, 2019 due to writedown in line with ongoing operations streamlining and merger & acquisition (M&A) costs for the purchase of Mega Printing & Packaging.

However, it recorded the best quarterly revenue of RM123.28 million on the back of increasing flexible packaging sales in Malaysia and regional markets.

According to the group’s filing with Bursa Malaysia, the recognised inventories written down amounted to about RM5.71 million along with a one-off M&A related transaction costs amounting to about RM1.14 million.

For the cumulative 19-month period from Jan 1, 2018 to July 31, 2019, Daibochi reported a net profit of RM17.3 million with RM699.34 million in revenue.

Its financial year end has been changed to July 31 from Dec 31 to coincide with the financial year end of its holding company Scientex Bhd.

Daibochi said its expanded portfolio with the acquisition of MPP in August 2019 will further complement the group’s existing flexible packaging solutions and the enlarged manufacturing footprint will put it in a better position to capture new growth opportunities.

Commenting on its future prospects, Daibochi is confident that its ongoing optimisation efforts and the enlarged manufacturing operations will result in strong revenue performance and improved profitability for the coming financial year.

Group managing director Thomas Lim said as it now operates under the Scientex fold, the group has adopted a just in time model and are in the process of integrating its operations to Scientex’s SAP system, which would significantly boost operating efficiency.

Legion Master to take Degem private at RM1.10 a share

PETALING JAYA: Degem Bhd’s major shareholder Legion Master Sdn Bhd (LMSB) has initiated a selective capital reduction (SCR) and repayment exercise with an offer price of RM1.10 in a bid to take the company private.

The total capital repayment amounts to RM24.33 million.

Currently LMSB and the persons acting in concert, including chairman Datuk Hasan M. Taib, collectively hold an 83.1% equity stake in Degem, according to Degem’s filing with the local bourse.

The offer price of RM1.10 represents a premium of 33.9% against its five-day volume-weighted average price of 82.15 sen.

Trading in Degem shares was suspended pending the material announcement. It was last traded at 83 sen.

The proposed SCR is expected to be funded via existing cash balances and internally generated funds.

LMSB opined that the listing status of Degem may have a minimal value to the group and its shareholders as it has not undertaken any equity fundraising through the platform for the last 10 years.

Furthermore, the group bears additional costs in order to comply with the relevant regulatory requirements as a listed company.

Yinson’s second-quarter earnings down 44%

PETALING JAYA: Yinson Holdings’ net profit fell 44.2% to RM41.14 million for the second quarter ended July 31, 2019 from RM73.67 million recorded in the same quarter of the previous year, due to net unfavorable foreign exchange movement of RM5.6 million, impairment loss on property, plant and equipment of RM4.86 million and higher finance costs of RM4.96 million.

However, it was partially set-off by improved profit contribution on lower operating expenditure and lower impairment loss on advances to a joint venture, trade and other receivables of RM2.12 million.

Its revenue declined 13.4% to RM213.44 million from RM246.54 million reported previously.

The group has declared an interim dividend of 4 sen for the quarter under review.

For a six-month period, Yinson reported a net profit of RM91 million, a 32.1% drop from RM134.1 million reported in the same period a year ago on the back of a 12.3% fall in revenue to RM422.44 million from RM481.72 million.

The group told Bursa Malaysia that revenue from its offshore & marine segment for the six-month period fell to RM410.35 million from RM480.88 million, mainly due to the effect of cessation of revenue contribution from FPSO Allan’s charter at Olowi field in Gabon, impairment loss on advances to a joint venture and net unfavorable foreign exchange movement.

Meanwhile, the group’s other business segment turned into a profit of RM9.64 million compared to a loss of RM120,000 recorded previously, mainly driven by higher interest income, absence of fair value loss on investment properties and lower fair value loss on other investments.

Yinson said the long-term outlook in the oil and gas industry remains challenging with the emergence of new alternative energy resources and financial institutions risk appetite towards the sector.

“Nevertheless, the management is optimistic that the industry will replenish its production capacity with new FPSO awards in current financial year to counter the lagging investment effect from the past years.”

Amid the challenging global economic environment and the volatility of other currencies against US dollar, the group said it will strive to achieve satisfactory results for the financial year ending Jan 31, 2020.

Google says won’t pay media firms to display content

PARIS, Sept 25 — Google will not pay French news companies to show excerpts of their articles, pictures or videos in search results, a top executive said today, though it will not display the excerpts without their approval. The move comes after…