cahya mata


Bursa stays negative at mid-day on selling pressure

KUALA LUMPUR, Oct 24 — Bursa Malaysia remained in negative territory at mid-day after range-bound trading in the early session today. A dealer said this was weighed down by persistent selling pressure due to the lack of fresh market catalysts. At…

Cahya Mata Sarawak registers 4.6% rise in Q1 earnings

PETALING JAYA: Cahya Mata Sarawak Bhd (CMSB) saw its net profit increase 4.6% to RM40.76 million for the first quarter ended March 31, 2019 compared with RM38.98 million in the same quarter a year ago, driven by higher contribution from its core businesses, namely cement, construction materials & trading and property development.

Its revenue also soared 17.8% to RM418.18 million from RM354.99 million.

In a filing with the stock exchange, the group said cement division’s profit before tax (PBT) surged 67% to RM11 million as sales volume of both cement and concrete products increased 9% and 70% respectively.

The construction materials & trading division’s PBT more than doubled to RM20.98 million, attributable to higher revenue and gross profit margin a well as a reversal of a provision of RM9 million.

The construction & road maintenance division, however, reported a lower PBT of RM15.33 million due to lower overall gross profit margin as a result of cost revisions in project and higher road maintenance costs.

Meanwhile, the property development division’s PBT jumped more than seven times to RM15.08 million thanks to a recognition of profit of RM10.90 million from a land sale, higher number of condominium units sold and higher rental income from unsold apartments.

Going forward, CMSB’s group CEO (corporate) Datuk Isaac Lugun expects the rebound in its businesses will continue and to be driven by the ongoing Pan Borneo Highway project and the state government’s increased spending on infrastructure.

At 2.35pm, CMSB shares were trading 8 sen or 2.5% higher at RM3.27 with 161,100 shares changing hands.

Cahya Mata JV bags RM466m Bintulu bridge job

BINTULU: Cahya Mata Sarawak Bhd’s consortium PPES Works CCCC JV Sdn Bhd today received and accepted a RM466.68 million contract for the proposed construction and completion of the Bintulu – Jepak bridge crossing Kuala Kemena.

PPES Works CCCC is a joint venture between Cahya Mata’s 51%-owned subsidiary PPES Works (Sarawak) Sdn Bhd and China Communications Construction Company (M) Sdn Bhd (CCCC).

The remaining 49% equity interest in PPES Works is held by Sarawak Economic Development Corporation.

The tenure of the contract is for 48 months, commencing April 3, 2019, with completion targeted for April 2, 2023.

The agreement stipulates that the iconic bridge crossing Batang Kemena at Bintulu – Jepak be approximately 1,048m long with a four-lane double carriageway, with a cable-stayed bridge complete with a flyover over Jalan Tun Ahmad Zaidi, Jalan Tun Razak and the Jalan Abang Galau traffic junction, with an approximate 4km connecting road.

The contract is expected to contribute positively to Cahya Mata’s earnings during the tenure of the contract.

Its shares went up 7 sen or 2.1% to close at RM3.40 today on 1.68 million shares done.

Cahya Mata Sarawak is a leading corporation listed on the Main Market of the Malaysian stock exchange, Bursa Malaysia, and is a major private-sector player in Sarawak.

CMS sees record profit in 2018

KUCHING: Cahya Mata Sarawak Bhd (CMS) reported a total revenue of RM1.71 billion and a pre-tax profit (PBT) of RM375.37 million for financial year 2018 (FY2018), an increase by nine and 17 per cent, in comparison to the preceding year’s (FY17) revenue of RM1.58 billion and PBT of RM321.29 million. The Group’s profit after tax […]

Cahya Mata Sarawak bottom line slips in Q4

PETALING JAYA: Cahya Mata Sarawak Bhd’s (CMSB) net profit slipped 5.7% to RM57.12 million for the fourth quarter ended Dec 31, 2018 against RM60.56 million in the previous corresponding period, due to lower gross profit margin.

Revenue also came in 12.7% lower at RM496.43 million from RM568.63 million.

The group has proposed to declare a first and final dividend of 7.4 sen per share for the quarter under review.

CMSB’s full-year net profit soared 27.7% to RM265.74 million from RM208.03 million on the back of an 8.6% rise in revenue to RM1.71 billion from RM1.58 billion.

It told Bursa Malaysia that the significant improvement in the group’s financial performance was mainly due to the increase in the share of results of associates namely OM Materials (Sarawak) Sdn Bhd, SACOFA Sdn Bhd, KKB Engineering Bhd and Kenanga Investment Bank Bhd.

The cement division reported a lower profit before tax (PBT) of RM90.14 million in FY18 compared with RM101.34 million in FY17 as a result of repair costs from the planned maintenance shutdown at its clinker plant during the first and third quarters of 2018.

The construction materials & trading division reported a PBT of RM71.29 million for FY18, which was 19% higher than FY17’s RM59.71 million.

The construction & road maintenance division registered a strong PBT of RM90.38 million, comparable to FY2017’s profit of RM90.20 million underpinned by strong revenue from the construction of Pan Borneo Highway project, the Miri-Marudi road rehabilitation project and the Sarawak Museum project.

Meanwhile, the property development segment saw a 3% stronger PBT of RM33.82 million mainly attributable to higher profit recognised from construction activities.

Looking ahead, CMSB CEO (Corporate) Datuk Isaac Lugun expects to see improved performance from its traditional core businesses of cement, construction materials & trading and construction & road maintenance to be primarily driven by the Pan Borneo Highway project.

Economist: Asean may benefit from US-China trade tensions

KUALA LUMPUR, Feb 23 ― Asean, especially Malaysia, Thailand and Vietnam, is a potential beneficiary of international companies moving out of China amid the trade tensions with the United States, said Maybank Kim Eng Singapore senior economist Chua…

Analysts predict good year to come for CMS

KUCHING: Sarawak-based Cahya Mata Sarawak Bhd (CMS) is expected to report its fourth quarter 2018 (4Q18) results on the last week of February with analysts predicting the cementmaker to expect a good year to come in spite of lower predictions for 4Q. This comes as RHB Research Institute Sdn Bhd (RHB Research) anticipated for 4Q18 […]

‘Buy and hold’ may not fit flattish market: MIDF

PETALING JAYA: As a flattish market in the near term does not bode well for a “buy and hold” strategy, MIDF Research advised the investors to focus on velocity and volatility of sectors and stocks to whither uncertainty.

In a strategy report today, the research house said it recommended a trading strategy focusing on velocity and volatility which is divided into four quadrants, namely “opportunist”, “trading”, “buy and hold” and “bullets”.

Overall, MIDF Research said it observed that construction players are the most suitable for a “trading” strategy due to their high velocity and high volatility.

It noted that construction stocks make a huge part of this quadrant, which include Malaysian Resources Corp Bhd, WCT Holdings and Gamuda Bhd.

For aviation, MIDF believes that AirAsia Group will suit well for a trading strategy too.

“With ample liquidity and a healthy newsflow driven price volatility, a trading portfolio would be ideal to generate returns amidst a ‘flattish’ movement of the benchmark indices.

“Liquidity would support ease of trading movement and the newsflow would provide the incentive to take trading position towards ‘sell high’ and ‘buy ‘low’ investment decision process,” it noted.

The research house said other sectors, such as rubber gloves fit to be used as “bullets” for the execution of the “opportunist” trading strategy.

MIDF said, this “opportunist” quadrant describes stocks that are relatively have low traded volume and highly volatile price movements, and stocks sitting in this quadrant includes YTL, UEM Sunrise, Sunway Construction and Cahya Mata Sarawak.

“All of these are great stocks to be included in the portfolio, but due to low liquidity, investors have to scan the market sentiment and wait for an opportunistic time to buy these stocks, wishing for Lady Luck to show herself.”

MIDF noted that the “bullets” quadrant describes stocks that relatively have high liquidity and low price volatility, while “buy and hold” describes stocks that are relatively have low traded volume and less price movements.

Stocks sitting in “buy and hold” quadrant includes UOA Development, Nestle and KKB Engineering.

The research firm said the FBM KLCI has been on a flattish trend so far this year with a year-to-date growth of less than 1% but expects earnings to grow by mid single-digit amid supportive economic policies.

Overall, it reiterated its FBM KLCI year-end 2019 target at 1,800 points.

AmInvestment Bank: CMS could see drag from infra cutbacks, increased competition

KUCHING: The team at AmInvestment Bank Bhd (AmInvestment Bank) is turning cautious on Cahya Mata Sarawak Bhd (CMS) due to the cutback in public infrastructure spending nationwide, including East Malaysia. The firm in a report yesterday said it was mindful of the change in the competitive landscape for the construction and building materials sectors in […]

Cahya Mata downgraded on higher risk to earnings

PETALING JAYA: AmInvestment Bank has downgraded its call for Cahya Mata Sarawak Bhd (CMS) to “underweight” from “buy” and lowered its fair value by 37% to RM2.48 from RM3.91 previously, due to increased earnings risk for the company.

In its report today, AmInvestment Bank said it has raised CMS’ FY18 net profit forecast by 20% to largely reflect better performance from CMS’ associate OM Materials but FY19-20 earnings have been cut by 5% and 14% respectively on weakened prospects for the construction and building materials sectors in Sabah and Sarawak.

“Having recovered by a whopping 59% to RM3.05 from the post 14th General Election low of RM1.92 on May 21, 2018, we believe the stock’s risk premium could now have overshot to the downside (versus overshooting to the upside previously),” it said.

The research house highlighted three potential events that could affect CMS’ performance over the short to medium term namely, the cutback in public infrastructure spending nationwide; the change in landscape for the construction and building materials sectors; and the performance of the group’s various associates particularly OM Materials.

According to AmInvestment Bank, the Sarawak state government has an ambitious plan for public infrastructure spending, including the construction of a new coastal highway and the second trunk road, both of which are multi-billion ringgit projects that would translate to construction jobs for contractors and demand for building materials.

“However, given the scale and size of the projects, we believe it will need funding support from the federal government. We are mindful that this will be a major challenge given the federal government’s adherence to fiscal prudence and sustainability, resulting in a significant cutback in public infrastructure spending across the nation, and Sarawak will have to compete with other states in Malaysia, which are equally hungry for federal funding to finance their respective projects,” it added.

It expects more competition in the construction and building materials sectors in Sabah and Sarawak, potentially arising from open bidding for government jobs, especially federal-funded projects.

Competition could also come from open bidding for road maintenance concessions, especially for federal roads in Sabah and Sarawak as well as the increased participation of peninsular-based companies in the construction, cement and aggregate markets in Sabah and Sarawak.

“These will put a dent on CMS’ prospects of winning new construction jobs, securing extensions for its road maintenance concessions, as well as sustaining high margins for its construction, road maintenance and cement businesses,” it added.

Note that CMS’ outstanding construction order book stands at RM1.3 billion, coming entirely from the Pan Borneo Highway. It has two road maintenance concessions covering 241km of federal roads and 5,847km of state roads in Sarawak.

It is also the sole cement producer in Sarawak with an estimated cement consumption of 1.6 million tonnes in 2018.