Thursday, October 3rd, 2019

 

EU warns Brexit Britain on pushing trade deals while still in bloc

BRUSSELS, Oct 3 — The European Union has warned London not to overdo its campaign to independently negotiate trade deals around the world while still being a member of the bloc, according to a letter to the British ambassador to Brussels seen by…


Sterling soars above US$1.24 on hopes of a Brexit deal

LONDON, Oct 3 — Sterling jumped to an eight-day high today after the head of a group of eurosceptic lawmakers in Prime Minister Boris Johnson’s Conservative Party said the government’s latest Brexit proposals offered the possibility of a…



US services sector activity hits three-year low; labour market solid

WASHINGTON, Oct 3 — US services sector activity slowed to a three-year low in September amid rising concerns about tariffs, the latest sign that trade tensions were eroding economic momentum. Despite the rising risks of a recession, the economy…


Saudi Arabia restores full oil output after attacks, focused on Aramco IPO

MOSCOW, Oct 3 — Saudi Arabia has fully restored oil output after attacks on its facilities last month and is now focused on the listing of state oil giant Saudi Aramco, its energy minister Prince Abdulaziz bin Salman said today. The kingdom’s…


Govt working with e-commerce players to promote local products

KUALA LUMPUR, Oct 3 — The Domestic Trade and Consumer Affairs Ministry has taken the initiative to work with e-commerce industry players in promoting local products through the Buy Malaysia campaign, its minister Datuk Seri Saifuddin Nasution…


Wall Street steady ahead of service sector data

NEW YORK, Oct 3 — US stocks treaded water today after losing three per cent in the past two sessions on data that pointed to the risk of a slide into recession, with investor attention now squarely on services data. The ISM’s non-manufacturing…


Domestic construction contract awards slump in Q3

PETALING JAYA: The Malaysian construction sector saw an 81% year-on-year (yoy) slump in domestic contract awards in the third quarter (Q3) of 2019 to RM1.1 billion, bringing the nine-month sum to RM9.2 billion or a 36% decline compared with the corresponding period of 2018.

And now, the sector is pinning hopes on Budget 2020 with potential announcements on infrastructure projects, possibly the Johor Baru-Singapore Rapid Transit System Link (RTS), MRT3 and Kuala Lumpur-Singapore High Speed Rail (HSR), according to HLIB Research.

Elsewhere, contracts that are expected to be rolled out are six bridge deals with a combined value of RM2.4 billion under the Sarawak Coastal Road.

“Other material developments related to the sector are the ramp-up of LRT3 project (RM16 billion) in Q4 19 and potential signing of a PDP (project delivery partner) agreement for the Penang Transport Master Plan by year-end (RM24 billion).”

The research house said the decline in contract awards was due to smaller average contract size of RM90 million (-22% quarter on quarter, -59% year on year) compounded by contraction in number of contracts awarded which totalled 12 in the third quarter of 2019.

Infrastructure jobs made up 31% of domestic contracts for the nine-month 2019 period with the balance from building jobs. The decline in contract value and lower proportion of infrastructure works was attributable mainly to holding back or downsizing of infrastructure projects post 14th General Election (GE14).

“Year to date, all Sarawak-related contracts are infrastructure works which testify to our view that momentum of project flows in Sarawak is gaining traction as the next state elections must be held before September 2021. Infrastructure contracts that are expected to roll out in Q4 19 are six bridge contracts with combined value of RM2.4 billion under Sarawak Coastal Road,” said HLIB.

Meanwhile, foreign contract awards in third quarter 2019 spiked to RM918 million while cumulative nine-month 2019 foreign contracts surged more than sixfold due to domestic contractors shifting focus overseas post-GE14 and absence of foreign contracts in second quarter 2018.

HLIB Research remains “neutral” on the construction sector despite the positive news flow on several project revivals, including the East Coast Rail Link (ECRL), Bandar Malaysia and potentially MRT3.

“We believe the worst is over for the construction sector but this has been largely reflected by the share price rally YTD with the Bursa Malaysia Construction Index up 31%.”

IJM Corp Bhd remains its top pick in the large-cap space as a beneficiary of the ECRL via construction contracts and the positive spillover effect to Kuantan Port (60% stake) and Malaysia-China Kuantan Industrial Park (20% stake).

“Within the mid-small-cap space, we like Sunway Construction Group Bhd (SunCon) as a well-managed pure construction play that is able to bid competitively within the increasing open tender landscape.”


Eastland Equity to raise RM2.6m via private placement

PETALING JAYA: Eastland Equity Bhd is expected to raise up to RM2.65 million from a private placement exercise of up to 10% of its total issued share.

The property developer told Bursa Malaysia that the estimated figure is based on an indicative price of 9 sen for 29.48 million shares.

Of the proceeds raised, some RM772,000 will be utilised towards repayment of bank borrowings; RM1.45 million for property development activities; RM327,000 for general working capital; and RM100,000 for private placement expenses.

However, Eastland said the private placement will not address the group’s current financial concerns as the estimated gross proceeds would not be sufficient to meet its funding requirements in the long-term or to improve its financial performance.

“However, the proposed private placement serves as an interim measure for the group to address its impending cash flow requirements whilst allowing the group to explore the acquisition of land/joint development rights.”

“In the event such acquisition (when materialised) requires additional funding, the company will explore other funding options, including debt and/or equity.“


MCIS Life aims for new heights with rebranding

PETALING JAYA: MCIS Insurance Bhd, now known as MCIS Life, unveiled a new corporate identity today following a rebranding exercise which will see the company repositioning itself among Malaysian consumers.

MCIS Life CEO and managing director Prasheem Seebran said the exercise began in 2014, when South Africa-based Sanlam Group acquired a majority stake, and was completed on Oct 1.

“We intend to take this company to new heights in Malaysia. We are a very ambitious company and we have plans to grow even further over the next three to five years.

“Our brand-new identity is all about empowering people to be a part of something bigger than themselves and what better way than contributing towards a better environment for everyone,” he told the media at the brand launch today.

The rebranding of the life insurer marks a new era of mutual assistance and protection as the company also unveiled its brand promise of “People Helping People”.

According to Prasheem, MCIS was top among life insurers in Malaysia in 1H19 in terms of new business growth, and going forward, the company will target previously underserved segments.

“There will be expansion over all of Malaysia whether it’s new territories that we enter or whether it’s new markets like the underserved segments in Malaysia, MCIS wants to play its part,” he said.

Looking ahead, Prasheem said the company had set ambitious growth targets but declined to provide details, saying only that the company would maintain a growth target of between 40% and 60%.

“I don’t want to give exact numbers right now, but our targets are very high and ambitious. We want to penetrate areas that Malaysia has not historically penetrated before, such as the B40 segment, and it’s up to us to provide protection to these communities,” he said.

Meanwhile, in conjunction with the rebranding, Prasheem announced MCIS’ corporate social responsibility initiative in which the company pledged to support and nurture, over a period of five years, some 500,000 seedlings consisting of six endemic species of rainforest trees.

“We want to contribute to the rehabilitation and restoration of our natural ecosystem in Malaysia. Our humble efforts will begin with the initial planting of 1,200 trees (of the identified six species) and we will nurture the trees and the seedlings produced by the trees in two separate locations in Selangor,” he said.

Over a period of five years, the initial 1,200 trees are expected to produce new seedlings, which will continue to be planted in identified locations through a smart collaboration with Majlis Perbandaran Sepang.

Energy, Science, Technology, Environment and Climate Change Minister Yeo Bee Yin said MCIS would receive the government’s full support in its initiative.

“The government supports all efforts by corporates, the private sector, NGOs and other agencies to plant trees as well as preserving green lungs and forests. This is in line with the government efforts to keep our 1992 Rio de Janeiro commitment of maintaining our forest cover at least 50%,” she said at the launch.