TSH (9059) : TSH 9M core earnings exceed forecasts: PIVB Research
KUALA LUMPUR: Public Invest Research said TSH Resources’ (TSH) core earnings for the nine months ended Sept 30, 2014 of RM108.7mil exceeded forecasts.
It said on Wednesday core earnings rose by a healthy 13% and exceeded its and consensus forecasts, accounting for 87% and 77% of full year forecasts respectively.
“The good results were mainly driven by stronger fresh fruit bunches (FFB) production growth, which offset the weaker crude palm oil (CPO) selling prices.
“Nevertheless, we expect weaker results for the last quarter attributed to weaker CPO selling prices. Meanwhile, no dividend was declared for the quarter. We continue to rate TSH with a Neutral call with an unchanged TP of RM2.05,” it said.
Public Investment Research said TSH’s Q3, FY14 revenue was higher mainly driven by improved sales in the plantation segment (+14.4%), despite a decline in its wood product segment, (-10.6 %).
Other income, which is mainly the cocoa business, was up 11.5% from RM8.7mil to RM9.7mil due to higher export volume.
Average CPO prices weakened from RM2,239 a tonne to RM2,170 while FFB production jumped 26.1% to 402,661 tonnes due to impressive contributions from Indonesia (+31.7%) and Sabah (+8.1%).
“Excluding unrealised forex loss of RM6.4mil, the group still registered encouraging core net profit of RM30.2mil, a decent earnings growth of 23.8%.
“Plantation‟s operating earnings jumped 18% attributed to higher CPO production sales and better operational efficiencies. Cocoa business reversed from last year’s loss with a gain of RM2.2mil.
“However, the refining palm kernel crushing business, which is in collaboration with Singapore-listed Wilmar International, has continued making losses, RM1.3m this time round,” it said.
Wood production made a minimal loss due to weaker demand from the European market, and impairment losses on trade receivable and inventories.
Public Invest Research said going forward, apart from growing its landbank, management is also looking at cost optimisation to improve its earnings margin. Meanwhile, we continue to rate TSH with a Neutral call.- The Star
KUALA LUMPUR: Public Invest Research said TSH Resources’ (TSH) core earnings for the nine months ended Sept 30, 2014 of RM108.7mil exceeded forecasts.
It said on Wednesday core earnings rose by a healthy 13% and exceeded its and consensus forecasts, accounting for 87% and 77% of full year forecasts respectively.
“The good results were mainly driven by stronger fresh fruit bunches (FFB) production growth, which offset the weaker crude palm oil (CPO) selling prices.
“Nevertheless, we expect weaker results for the last quarter attributed to weaker CPO selling prices. Meanwhile, no dividend was declared for the quarter. We continue to rate TSH with a Neutral call with an unchanged TP of RM2.05,” it said.
Public Investment Research said TSH’s Q3, FY14 revenue was higher mainly driven by improved sales in the plantation segment (+14.4%), despite a decline in its wood product segment, (-10.6 %).
Other income, which is mainly the cocoa business, was up 11.5% from RM8.7mil to RM9.7mil due to higher export volume.
Average CPO prices weakened from RM2,239 a tonne to RM2,170 while FFB production jumped 26.1% to 402,661 tonnes due to impressive contributions from Indonesia (+31.7%) and Sabah (+8.1%).
“Excluding unrealised forex loss of RM6.4mil, the group still registered encouraging core net profit of RM30.2mil, a decent earnings growth of 23.8%.
“Plantation‟s operating earnings jumped 18% attributed to higher CPO production sales and better operational efficiencies. Cocoa business reversed from last year’s loss with a gain of RM2.2mil.
“However, the refining palm kernel crushing business, which is in collaboration with Singapore-listed Wilmar International, has continued making losses, RM1.3m this time round,” it said.
Wood production made a minimal loss due to weaker demand from the European market, and impairment losses on trade receivable and inventories.
Public Invest Research said going forward, apart from growing its landbank, management is also looking at cost optimisation to improve its earnings margin. Meanwhile, we continue to rate TSH with a Neutral call.- The Star
