KUALA LUMPUR (Feb 12): Based on corporate announcements and news flow today, companies likely to be in focus next Monday (Feb 15) include AmFIRST Real Estate Investment Trust (AmFIRST REIT), Excel Force MSC, Yen Global, Warisan TC, Sona Petroleum, Sunway, Tenaga Nasional (TNB), Malakoff Corp and Maxwell International.
AmFIRST Real Estate Investment Trust (AmFIRST REIT) registered an 11% decline in its net property income to RM14.46 million for the third quarter ended Dec 31, 2015 (3QFY16), from RM16.29 million a year earlier.
The fall was in line with a 10% contraction in revenue for the quarter to RM24.17 million, from RM26.81 million.
For the nine months ended Dec 31, net property income fell 13% to RM44.60 million, from RM51.25 million; while cumulative revenue for the period was down 9% at RM73.76 million, compared to RM81.20 million in the previous year.
AmFIRST REIT attributed the decline in its income for the period to lower gross revenue from lower occupancy rate and higher interest expense.
Lower occupancy rates was recorded at Prima 9 and Menara Ambank, coupled with rebates on rental to tenants of the Summit Retail Podium and Summit Hotel for temporary disruption due to on-going refurbishment works.
Higher interest expense was due to additional borrowing to finance the various asset enhancement initiatives at its existing properties and also for deposit payment for the acquisition of Mydin Hypermall.
Going forward, the REIT said it will initiate more intense leasing and proactive market measures to improve occupancy of properties under its portfolio, as well as counter lower rental revenue from The Summit USJ as a result of the rental rebates.
It said the refurbishment of The Summit retail podium will be completed by the first quarter of the financial year ending March 31, 2017 (FY17), expecting better revenue contribution from the asset upon completion of the works.
Meanwhile, AmFIRST said the acquisition of Mydin Hypermall has been completed on Jan 29, and has started to generate positive net rental income.
On the proposed disposal of the AmBank Group Leadership Centre, the REIT said the selling price of RM36 million represents a 57% premium to the asset’s carrying value of RM22.9 million as at Dec 1.
It said the expected net gain of RM8.4 million from the sale will be dished out as income distribution, while the balance will be used to pare down its debts.
Businessman Datuk Jayakumar Panneer Selvam has emerged as a substantial shareholder in computer software application solutions provider Excel Force MSC Bhd.
This follows his acquisition of 514,600 shares in the company on Feb 10, boosting his equity interest in the company to 10.42 million shares or 5.04%, according to a filing with Bursa Malaysia today.
Jayakumar, 49, is the chief executive officer of PDX.com Sdn Bhd, which is involved in several electronic government projects.
Excel Force’s largest shareholders are its chairman and managing director Jeff Wang, and his wife Sharon Sun — who is also the company’s executive director. Collectively, the couple controls 32.8% of the company’s equity.
Yen Global Bhd has been issued an unusual market activity (UMA) query by Bursa Malaysia, following the recent rise in the price and trading volume of its shares.
The company was asked to disclose if there is any corporate development, rumour, report or any other possible explanation for the unusual trading of its shares.
Since the beginning of 2016, Yen Global’s share price has increased 13% to its closing of 48.5 sen yesterday (Feb 11). The company saw a spike in its trading volume today, with some 12.5 million shares exchanged, compared to total trades of 531,000 yesterday.
The counter was among the top actives on the exchange.
For the first quarter ended Oct 31, 2015, Yen Global widened its net loss to RM1.66 million, from RM482,000 in the previous year, on the back of a 26% decline in revenue to RM5.80 million, from RM7.85 million.
Mayflower Acme Tours Sdn Bhd, a wholly-owned subsidiary of Warisan TC Holdings Bhd, is proposing to acquire a 55% stake in GoCar Mobility Sdn Bhd, a new startup company which currently operates a web-based platform for car rental business.
In a filing with Bursa Malaysia today, it was revealed that Mayflower Acme entered into a conditional sale and purchase agreement and conditional subscription agreement to respectively acquire 10,000 shares or 5% in GoCar from Ideal Force Sdn Bhd, and to subscribe for 100,000 new shares or 50% in GoCar, for a total consideration of RM450,000.
The acquisition is expected to strengthen Mayflower’s position in the retail rental car market and provide the company with immediate access to a self service, automated and web-based retail platform for car rental business.
Special purpose acquisition company (SPAC) Sona Petroleum Bhd is further negotiating on the value of its proposed acquisition of Australia’s stag oilfield, after independent valuers deemed the transaction unfairly priced.
In a filing with Bursa Malaysia, Sona Petroleum said it has received conditional approval from the Securities Commission of Malaysia (SC) of the acquisition today, but said the SC had noted that according to independent technical and asset valuation expert Gaffney, Cline and Associates (Consultants) Pte Ltd in a valuation report dated Jan 20 this year, the purchase price was considered “not fair”, as it was above fair market value of the oilfield in question.
“However, in this regard, the company is currently in negotiations with the sellers of the Stag oilfield to reduce the purchase consideration for the proposed acquisition,” the filing stated.
Sona Petroleum said SC’s approval is subject to several conditions. Among them is that Sona Petroleum is expected to utilise up to 80% of the amount in its trust account for the acquisition of the Stag oilfield and to finance part of the infill development.
Sona Petroleum said the funds to be utilised for the infill development will be placed in another trust account, with a proper approval process in place for the monitoring and disbursement of funds.
Sona Petroleum will also issue monthly and quarterly updates through announcements on Bursa Malaysia on the amount of cash drawn down and balance in the trust account, the filing stated.
The company also has to appoint an additional independent non-executive director who has the appropriate qualification and experience to effectively discharge the role of an independent director of a listed company, prior to the issuance of the circular to shareholders.
On Nov 2, Sona Petroleum had announced it is planning to buy Australia’s Stag oilfield for US$50 million from Quadrant Northwest Pty Ltd and Santos Offshore Pty Ltd for US$50 million (RM208 million), and the transaction is also intended to be the SPAC’s qualifying acquisition (QA).
The oilfield is located at the Carnarvon Basin, offshore Western Australia.
The agreement entails Sona Australia acquiring 100% interest in the production license WA-15-L and pipeline license WA-6-PL and the associated assets, which are collectively known as the Stag Oilfield, along with the operatorship of the oilfield.
The acquisition is expected to be completed by March 31, 2016, following which Sona Petroleum is expected to have access to 13 million stock tank barrels (MMstb) of proved (1P) oil reserves, 16.2 MMstb of proved plus probable (2P) oil reserves and 24.0 MMstb of proved plus probable plus possible (3P) oil reserves.
Sunway Property, the property unit of Sunway Bhd, has clinched 95% sales at its debut launch of retails units in a mixed development project in Bangi, Selangor.
The 34 units, collectively known as Sunway Gandaria’s Retail, range from 983 sq ft to 6,071 sq ft in size and are priced from RM832,000.
Since their preview in mid-December last year, 32 units have been sold, said Sunway in a statement today.
Ang Kee Ping, Sunway’s property development director for central region, attributed the brisk sales to the strategic location in Pusat Bandar Baru Bangi and its value for investment.
“We are encouraged by the successful launch, which will indicate a well take up rate for the upcoming launches of the residential component,” he said.
Sunway Gandaria Retail is the RM54 million gross development value (GDV) retail component of the mixed development, dubbed the “Peak of Bangi. The entire development has a GDV of RM228 million and is expected to be completed by 2020.
Tenaga Nasional Bhd (TNB) and Malakoff Corp Bhd have inked a new power purchase agreement (PPA) to seal a three-year extension for the operation of Malakoff’s power plant in Tanjung Gemuk, Port Dickson.
It was previously announced that the Energy Commission had granted a conditional award to Malakoff’s indirect wholly-owned unit Port Dickson Power Bhd (PD Power), which owns the power plant, to extend operations commencing March 1, 2016 to Feb 28, 2019.
In a filing with Bursa Malaysia today, TNB said the new PPA governs the rights and obligations of both parties throughout the term of the extension for the generation and sale of electricity, and for PD Power to make its generating capacity available to TNB from its 436 megawatt (MW) open-cycle power plant.
“The signing of the PPA will not have any effect on the issued and paid-up share capital and the substantial shareholders’ shareholding of TNB, and will have a neutral impact on the earnings of TNB over the term of the extension,” it said.
In a separate filing, Malakoff said the PPA is expected to contribute positively to the earnings and net assets of the company, going forward.
Malakoff had purchased the power plant parked under Sime Darby Bhd’s power business for RM300 million cash in April 2014.
The plant supplies electricity to TNB under a 21-year power purchase agreement, which expired last month.
Maxwell International Holdings Bhd said it may engage an independent firm to carry out an investigative audit on its hefty advertising spending in China, which affected its overall financial performance.
In a filing with Bursa Malaysia today, the textile and sports shoe maker also shed more light on the controversial ad spending, which was undertaken by its intermediate subsidiary, Maxwell (Xiamen) Co Ltd.
It said the subsidiary had executed contracts last year, with six marketing agents in China for the promotion and establishment of 390 marketing billboards, as well as light emitting diode (LED) signboards for a period of one year.
The company paid a total of 92.4 million renminbi (RM58.56 million) for the contracts, it added.
Yesterday, Maxwell said it had appointed accounting firm Ferrier Hodgson MH Sdn Bhd to undertake an extended audit on the company’s advertising expenses.
This came a day after the company said management had yet to provide a satisfactory justification for the ad spending, and that its independent and non-executive director Lee Chong Hoe had resigned from the board.
The company had earlier blamed the RM46.25 million net loss it suffered in its third quarter ended Sept 30, 2015 (3QFY15) on ad spending, as compared with a net profit of RM12.18 million gained in its previous corresponding quarter.
Cash-rich Maxwell incurred selling and distribution expenses of RM42.59 million in its 3QFY15, which is a sharp jump as compared to RM1.09 million in the previous corresponding quarter.
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