KUALA LUMPUR (April 7): Based on corporate announcements and news flow today, companies that will be in focus tomorrow (Friday, April 8) may include: LPI Capital, Mah Sing, Maybank, TAS Offshore, Cahya Mata Sarawak (CMS), Reach Energy, Sern Kou and IOI Corp.
LPI Capital Bhd reported a 14.3% increase in net profit for its first quarter ended March 31, 2016 (1QFY16) to RM65.39 million or 19.7 per share, from RM57.2 million or 17.23 sen per share a year ago, thanks to a stronger performance from its wholly-owned insurance subsidiary Lonpac Insurance Bhd.
In its filing to Bursa Malaysia today, LPI reported a revenue of RM320.56 million for 1QFY16, which was 9.9% higher than its 1QFY15 revenue of RM291.73 million.
LPI founder and chairman Tan Sri Dr Teh Hong Piow said Lonpac had registered an impressive 21.8% jump in pre-tax profit for 1QFY16 to RM64.9 million, from RM53.3 million a year ago, which was largely due to higher underwriting profit.
Teh said Lonpac had managed to grow its gross premium income by 7.9% to RM401.7 million during 1QFY16, from RM373.24 million in 1QFY15 despite facing stiff competition.
However, Teh cautioned that the slower growth in premium income for the Malaysian insurance industry is expected to continue in 2016.
Property developer Mah Sing Group Bhd expects to "directly benefit" from Putrajaya’s newly-launched The First Home Deposit Funding Scheme (MyDeposit), as some 70% of its house buyers are first time home buyers aged below 40.
In a statement today, Mah Sing also noted that half of its residential launches this year are priced below RM500,000, which means a significant portion of potential buyers for these projects will be eligible for the scheme.
The scheme, introduced under Budget 2016 for middle-income earners to purchase properties under the RM500,000 price tag, began today.
Malayan Banking Bhd (Maybank) is still looking for merger and acquisition (M&A) targets to achieve its regional organisation status, with 40% of pre-tax profit derived from international operations.
Maybank president and chief executive officer Datuk Abdul Farid Alias said the banking group did not achieve the target by 2015, as it failed to acquire a suitable asset.
He said although there are a lot of opportunities, the bank is not pressured to achieve the target by acquiring assets that are not suitable.
Abdul Farid, who sees difficulty in executing M&A plans, opines that the right assets must be able to be integrated with the group's operation and culture.
When asked if the bank is still pursuing Thailand's commercial banking business, he said the management is not limiting itself in a particular market.
TAS Offshore Bhd has lost yet another contract from QMS 1 Offshore Services Ltd (QOSL), after QOSL terminated a RM45.81 million shipbuilding contract with TAS Offshore's wholly-owned subsidiary TA Ventures (L) Ltd.
TAS Offshore said TA Ventures had received a notice of termination via email on April 5 to end an US$11.7 million (RM45.81 million) contract for the construction of one unit of offshore construction vessel.
"TAS Offshore's position is that the purported notice of termination is not valid and the company intends to proceed with legal proceedings," the filing stated. TAS Offshore said the vessel was ready for delivery within the agreed time frame.
Last month, TAS Offshore had also received a notice from QOSL to terminate contracts worth US$27 million to build two units of anchor handling tug supply vessels.
Cahya Mata Sarawak Bhd (CMS) has subscribed to 110 million convertible preference shares (CPS) of 10 sen each in Om Materials (Sarawak) Sdn Bhd (OMS) for RM110 million, cash.
CMS said the subscription consideration was arrived at on a willing-buyer willing-seller basis, after considering OMS’ net tangible assets stood at RM221 million as at Dec 31, 2015.
CMS also took into consideration the audited loss after tax generated by OMS of approximately RM32 million, based on the financial year ended Dec 31, 2015, and the future prospects of OMS.
The CPS will mature on the date which is 10 years from the date of issuance to the investors, CMS said.
Lembaga Tabung Haji has upped its stake in oil and gas special purpose acquisition company (SPAC) Reach Energy Bhd to 5.08% stake, representing 64.96 million shares.
A bourse filing showed the pilgrimage fund had purchased a total of 1.72 million Reach Energy shares between March 29, 2016 and April 4, 2016.
Tabung Haji is the second largest shareholder, after Reach Energy’s managing director Shahul Hamid Mohd Ismail, who has a 20% stake in the company.
Sern Kou Resources Bhd's wholly-owned unit Valued Products (M) Sdn Bhd (VPSB) plans to acquire seven leasehold industrial lands measuring 6.8ha in Gua Musang, Kelantan, for RM15 million to expand its wood and timber manufacturing and trading business.
The 99-year lease on the land, which has four buildings erected on it, expires on Nov 20, 2100.
The acquisition, expected to complete by the first quarter ending Sept 30, 2016 (1QFY17), will be funded via a combination of bank borrowings and internally-generated funds, the proportion of which will be determined at a later date.
In yet another blow following the suspension of its Roundtable for Sustainable Palm Oil (RSPO) certification, global food producer Unilever is on course of dropping IOI Corp Bhd (IOI Corp) from its supply chain.
In a statement issued last week, Unilever said it has set a time bound plan over the next three months to disengage from IOI Corp.
Unilever said it is, however, reaching out to IOI Corp and to relevant non-governmental organisations (NGOs) to help IOI Corp to rectify, address and remediate proven complaints on its operations in Indonesia.
In addition to Unilever, Singapore’s Straits Times reported that leading food and confectionary producers Mars and Kellogg's have also decided to drop IOI Corp from its supply chain. Mars and Kellogg’s did not respond to queries from theedgemarkets.com at press time.
http://www.theedgemarkets.com/my/article/lpi-capital-mah-sing-maybank-tas-offshore-cahya-mata-sarawak-reach-energy-sern-kou-and-ioi
