KUALA LUMPUR: The ringgit is likely to be on a downtrend against the US dollar next week as negative global growth sentiment weigh the currency’s performance, said Oanda Head of Trading Asia Pacific, Stephen Innes.
He said the ringgit would be traded at around 4.17 to 4.20 to the dollar while the oil market would also act as a determinant in the currency’s movement.
“Waning global growth sentiment continues to drag equity markets into the tank after a double whammy of major economic data misses has sent investors scurrying for cover.
“Weak growth in both China and the Eurozone are also providing the critical fundamental reasons to be underweight on equities, which will weigh on ringgit sentiment next week as investors flock to US treasuries and support the dollar on haven appeal,“ he told Bernama.
Meanwhile, FXTM Global Head of Currency Strategy and Market Research Jameel Ahmad said the market had widely expected that the US Federal Reserve (Fed) will raise US interest rates for the fourth time this year, and essentially, this had already been mostly priced into the ringgit.
“But the next risk for the ringgit depends on the path of interest rate increases for 2019,“ he added.
Jameel said that doubts were starting to creep in that the Fed would raise interest rates as often as four times next year, which is seen as a significant risk of weakness for the greenback moving forward.
“As one of the emerging markets that is known for being sensitive to US interest rate speculation, guidance that the Fed will not be as active with interest rate policy next year would be digested as positive news for the ringgit in 2019,“ he explained.
For the week just-ended, the ringgit closed mostly lower against the US dollar with the market sentiment moved by oil prices, the US-China trade negotiation outcome and investor worries on global economic outlook.
On a Friday-to-Friday basis, the local note weakened to 4.1830/1880 from 4.1640/1680 against the greenback from the previous week.
The ringgit traded mixed against a basket of major currencies throughout the week.
It depreciated against the Singapore dollar to 3.0393/0434 from 3.0385/0434 and appreciated against the British pound to 5.2635/2710 from 5.3116/3184.
Vis-a-vis the Japanese yen, the ringgit went up to 3.6842/6895 from 3.6899/6937 and strengthened against the euro to 4.7239/7299 from 4.7320/7373. — Bernama
PETALING JAYA: Berjaya Sports Toto Bhd’s (BToto) pre-tax profit for the second quarter ended Oct 31, 2018 fell 1.9% to RM94.29 million from RM96.08 million a year ago due to lower results from Sports Toto Malaysia Sdn Bhd.
In a filing with Bursa Malaysia, BToto said the lower results from Sports Toto was partly mitigated by improved results from H.R. Owen Plc and Philippine Gaming Management Corporation (PGMC).
Revenue for the quarter fell 2.3% to RM1.35 billion from RM1.38 billion a year ago mainly due to lower revenue reported by Sports Toto and H.R. Owen.
According to the group, Sports Toto’s 1.4% drop in revenue was mainly due to the previous year’s corresponding quarter which registered strong sales from its high jackpot in the Grand Toto 6/63 game, while its higher percentage decrease in pre-tax profit of 13.4% was mainly due to higher prize payout during the quarter under review.
PGMC’s revenue grew 7.2% during the quarter (when reporting in its functional currency) due to higher lease rental income earned consequent to improved sales of the Philippine Charity Sweepstakes Office.
Its pre-tax profit rose 49.8% due to lower operating expenses incurred. However, the unfavourable foreign exchange effect upon translation to ringgit resulted in PGMC’s revenue falling marginally by 0.4% while the increase in pre-tax profit was lower at 39%.
H.R. Owen’s revenue (in its functional currency) rose 1.1% due to higher revenue from new car sales. It recorded a pre-tax profit of GBP800,000 during the quarter compared with a loss of GBP700,000 a year ago due to higher sales from the new car sector.
However, upon translation to ringgit, the H.R. Owen reported a drop in revenue of 3.1% to RM523.6 million from RM540.3 million a year ago due to the unfavourable foreign exchange effect.
It recorded a pre-tax profit of RM4.5 million compared with a pre-tax loss of RM4 million a year ago.
For the six months ended Oct 31, 2018, pre-tax profit rose 6.4% to RM227.33 million from RM213.60 million a year ago while revenue fell marginally to RM2.85 billion from RM2.86 billion a year ago.
The board has declared a second interim dividend of 4 sen per share in respect of the financial year ending April 30, 2019 (FY19), payable on Feb 12, 2019. The entitlement date has been fixed on Jan 18, 2019.
The second interim dividend distribution for FY19 will amount to RM53.9 million. The total dividend distribution for the financial period ended Oct 31, 2018 is 8 sen per share amounting to about RM107.8 million, representing 73.2% of the attributable profit of the group for the period.
The group expects Sports Toto’s performance to be satisfactory and is confident that BToto will continue to maintain its market share in the number forecast operator business for the remaining quarters of FY19.
PETALING JAYA: Sime Darby Plantation Bhd (SDP) has appointed Mohamad Helmy Othman Basha as deputy managing director, as part of a succession plan to ensure a smooth transition in leadership once its incumbent managing director Tan Sri Mohd Bakke Salleh retires in June 2019.
The company said in a statement today that the appointment is part of the company’s plan to ensure seamless succession at its top leadership subject to performance appraisal and final approval of the board of directors.
Mohamad Helmy, 51, who is currently SDP’s COO of upstream will continue to be responsible over the plantation upstream business after his appointment to his new role comes into effect on Jan 1, 2019.
“Mohamad Helmy is a key member of our management team and has all the relevant experience and expertise to manage SDP’s vast integrated business. He has demonstrated strong leadership and commitment to performance, both of which are important qualities for senior management,” said Mohd Bakke who is also SDP’s executive deputy chairman.
Mohamad Helmy has more than 18 years of experience in the plantation industry, being appointed as COO of the division in 2017.
He is a Chartered Accountant and began his career as an auditor with Wellers, Accountants, Oxford, UK and has also worked in the oil and gas sector via his stint with the Shell Group in Malaysia.
In 1997, he joined Guthrie Property Holdings Sdn Bhd as the finance and administration manager where he rose up the ranks quickly and moved into the plantation sector.
Mohamad Helmy was also a key member of the Guthrie team that acquired Minamas Plantation in Indonesia in 2001 and later restructured it.
In 2007, after the merger that established the enlarged Sime Darby Group, Mohamad Helmy was appointed as the head of upstream Malaysia in Sime Darby Plantations Sdn Bhd. He also headed the company’s overseas expansion into Africa.
After a brief stint outside the company, Mohamad Helmy returned to SDP in 2016 as head of plantation services and special project, before being appointed to his current role.
KUALA LUMPUR: The ringgit weakened against the US dollar today as news that China’s retail sales and industrial production data was less than expected, was bearish for the local market, said OANDA Head of Trading Asia-Pacific Stephen Innes.
At 6 pm, the local note traded at 4.1830/1880 against the US dollar from Thursday’s 4.1780/1820.
The ringgit was seen tracking the movement of China’s renmimbi for quite some time as the latter was one of Malaysia’s major investors.
“I must admit I’m a bit surprised the ringgit did not trade with a more positive bias as US-China trade tensions have improved while the local unit should find support from a probable US Federal Interest rate pause in 2019.
“The market is indeed caught in the year-end malaise with local investors now fretting over oil markets and the outlook for global growth in 2019,” he told Bernama.
Against major currencies, the ringgit rose to 5.2635/2710 from 5.2902/2957 against the pound yesterday and improved to 4.7239/7299 versus the euro from 4.7533/7587 yesterday.
It strengthened slightly against the Singapore dollar to 3.0393/0434 from 3.0479/0519 on Thursday but slipped against the yen to 3.6842/6895 from 3.6817/6859 yesterday. — Bernama
PETALING JAYA: YFG Bhd’s RM40 million contract for the construction of a mixed development in Penang has been terminated by Atta Properties Sdn Bhd.
The group told the stock exchange that its wholly owned subsidiary YFG Engineering Sdn Bhd (YFGE) received the notice of termination from Atta Properties on Dec 13.
“The notice of termination was served to YFGE owing to some legal and financial issues which currently affect the progress and sub-contractor of the project on the part of Atta Properties,” it said.
The contract is for works related to the construction of a 23-storey building comprising apartments and office units in Bayan Lepas, Penang.
The termination is not expected to have any material effect on the earnings, net assets and gearing of the company and the group for the financial year ending Sept 30, 2019 as the project was at the initial stage of commencement.
The stock was untraded today.
PETALING JAYA: The Imbalance Cost Pass-Through (ICPT) surcharge for non-domestic customers will increase 1.2 sen to 2.55 sen/kWh in March 1, 2019, from 1.35 sen/kWh currently until Feb 28, 2019, according to Tenaga Nasional Bhd (TNB).
It said the government has approved via a letter from the Energy Commission (ST) dated Dec 14, 2018, the continued implementation of ICPT mechanism for the period of Jan 1 until June 30, 2019.
TNB said the remaining imbalance cost to be passed-through via the ICPT mechanism is RM948 million, which will be passed-through to non-domestic customers via staggered ICPT surcharge implementation.
“This staggered ICPT surcharge is a once-off implementation to allow ample notice and provide adequate transition period to the non-domestic customers. Moving forward, electricity customers will now have the ability to estimate future ICPT impact using the ICPT calculator available at www.myelectricitybill.my,“ TNB said in a stock exchange filing.
TNB said due to higher fuel and generation cost for the period of July 1 until Dec 31, 2018, the additional generation cost or imbalance cost is RM1.82 billion. This is mainly due to the increase in average coal price to US$97.84/metric tonne, as compared to the forecasted coal price set in the base tariff for Regulatory Period 2 (RP2) from 2018 to 2020, which is at US$75/metric tonne.
To cushion the impact of high fuel and generation cost of RM1.82 billion to be passed through to customers via the ICPT mechanism, the government has approved that part of the surcharge for non-domestic customers, amounting to RM564 million will be funded from cost and revenue adjustment of TNB for year 2018, which was agreed during the base tariff determination in RP2 under the Incentive Based Regulation (IBR) framework.
Meanwhile it said the average base tariff remain unchanged at 39.45 sen/kWh, adding that domestic (residential) customers are not affected by the ICPT surcharge.
“No surcharge will be applied to domestic customers, as the ICPT surcharge will be funded by Kumpulan Wang Industri Elektrik amounting to RM308 million,“ TNB said.
The ICPT is a mechanism approved by the government and implemented by ST since Jan 1, 2014 as part of a wider regulatory reform called the IBR.
ICPT mechanism allows TNB to reflect changes in fuel and generation costs in consumer’s electricity tariff every six months. This mechanism is implemented according to Section 26 of Electricity Supply (Amendment) Act 2015.
“The impact of ICPT implementation is neutral on TNB and will not have any effect to its business operations and financial position,“ TNB said.
PETALING JAYA: Pos Malaysia Bhd is acquiring two new adjoining units of one-and-a-half-storey link-detached factory located at Iskandar Halal Park, Johor for RM8.84 million from Tentu Teguh Sdn Bhd, a property development company linked to its major shareholder.
The group told the stock exchange that the properties, which sit on freehold land measuring 2,504.988 square metres will address its current office space constraint and business expansion plan.
Pos Malaysia will be acquiring the properties for RM4.42 million each.
The market value of each of the properties stood at RM4.74 million as appraised by independent valuer Hakimi & Associates Sdn Bhd.
Pos Malaysia said the proposed acquisition will be fully satisfied in cash through internal funds and/or bank borrowing.
The acquisition is deemed as a related party transaction since tycoon Tan Sri Seri Syed Mokhtar Shah Syed Nor, (Tan Sri Syed Mokhtar Al-Bukhary) is the major shareholder of both Pos Malaysia and Tentu Teguh.
The stock declined 8.02% to close at RM1.72 with 6.68 million shares done.
PETALING JAYA: The Securities Commission Malaysia (SC) has revised the prospectus and equity guidelines to enhance the disclosure requirements of abridged prospectuses and circulars related to certain proposals.
The proposals refer to those that would result in a significant change in the business direction or policy of a listed corporation, including back-door listings and reverse take-overs.
“The amendments aim to make abridged prospectuses and circulars more reader friendly while ensuring that disclosures focus on meaningful information and are useful in helping shareholders in making informed investment decisions,” the SC said.
The amendments, which will come into effect on March 13, 2019, were made after extensive consultation with key stakeholders such as principal advisers, reporting accountants, independent advisers, investors and representatives of listed corporations.
However, market participants and listed corporations are encouraged to adopt these revisions earlier for the immediate benefit of shareholders and investors.
Among the notable revisions are prospectus are now required to dedicate paragraphs for accountant’s statement and material transactions to disclose any transaction which may have a material effect on the operations, financial position and results of the corporation.
PETALING JAYA: Malaysia Airlines Bhd’s (MAB) saw its passenger yield come under pressure in the third quarter of 2018, falling 4.86% to 21.5 sen from 22.6 sen in the same quarter last year, partially due to the inability to deploy planned peak upgrading of aircraft to a widebody.
The airline said in a statement today that it was unable to deploy the planned peak upgrading of aircraft due to crew shortages, which also in turn impacted revenue.
Revenue per available seat kilometre (RASK) rose 1.43% to 21.2 sen from 20.9 sen a year ago driven by higher cargo revenue, which was up 29% year-on-year.
MAB carried some 3.47 million passengers in the quarter under review against the 3.40 million passengers flown in the third quarter of last year.
On-time performance (OTP) also increased during the quarter, up by 8% year-on-year to 74.9%, as a result of improved operational efficiencies in engineering and ground handling.
The national carrier said it experienced a challenging third quarter with stiff competition, rising fuel prices and adverse foreign exchange movements which was further exacerbated by crew shortages, especially in July and August.
The airline is confident that its crew shortage issue can be stabilised by early 2019, as it has since activated an extensive recruitment exercise, supported by an aggressive cadet enlistment and training programme to build a strong crew pipeline.
Passenger load factor during the quarter increased to 80.5% from 77.5% in the third quarter of 2017 while recovery in international business continued during the quarter with a load factor of 81.7% in 2018 versus 78.4% in 2017.
As for fleet developments, the airline saw the addition of its sixth A330-200 to its fleet of 21 such aircraft, which is deployed on higher density regional routes across Asia Pacific.
Meanwhile, its B737-800s continued to provide domestic and regional connectivity. The airline is also preparing for delivery of 10 B737 MAX8 in 2020.
MAB’s A380-800s continue to service Project Amal, a division dedicated to Hajj and Umrah traffic which successfully transported more than 15,000 pilgrims during Hajj on over 80 flights between Kuala Lumpur, Jeddah and Madinah throughout July and September 2018. The airline’s A380s are also deployed to key markets, such as Sydney and Seoul, during peak times.
MAB reported an overall improvement in Customer Satisfaction Index (CSI), which rose 7% year-on-year while its Net Promoter Score (NPS) increased significantly by 21 points during the period.
The airline attributed the improvements in its CSI and NPS to its continued focus on improving customer experience and enhancing product offering, including improvements to its call centre which saw satisfaction ratings rise 7% to 74%.
Group CEO Izham Ismail said the third quarter was challenging with volatile fuel prices, unfavourable foreign exchange movements and over capacity in key markets, compounded by pilot shortage.
“Nevertheless, in line with our emphasis on customer experience, I believe our efforts in that area continue to show positive traction as evidenced by the improvements in our CSI and NPS ratings. We are maintaining a strong focus on cost management and will continue to invest in aspects of the customer experience that deliver a competitive edge,” he said.
“Our pioneering digital initiatives, including the recently launched WhatsApp Business solution, exemplify this. We have seen good quarterly traction in the year and we are expecting to finish 2018 by reducing the losses of the previous year,” he added.
Izham noted that while 2019 looks similarly challenging, MAB is committed to improving performance and reducing costs while managing external factors beyond its control.