CIMB, Amway, KL Kepong, Ta Ann, Boustead Plantations and Wing Tai

KUALA LUMPUR (Nov 16): Based on corporate announcements and news flow today, stocks in focus on Thursday (Nov 17) may include CIMB Group Holdings Bhd, Amway (M) Holdings Bhd, Kuala Lumpur Kepong Bhd, Ta Ann Holdings Bhd, Boustead Plantations Bhd and Wing Tai Malaysia Bhd.

CIMB Group Holdings Bhd posted a net profit of RM1.02 billion for the third quarter ended Sept 30, 2016 (3QFY16), a 28% rise from RM803.89 million a year earlier, on higher net interest and non-interest income.

Higher Islamic banking income and a RM149.77 million gain from the sale of CIMB's stake in PT CIMB Sun Life also contributed to the higher profit.

Revenue rose to RM4.12 billion, from RM3.84 billion.

Cumulative 9MFY16 net profit rose to RM2.71 billion from RM2.02 billion, with revenue rising to RM11.75 billion from RM11.35 billion.

On outlook, CIMB said its T18 Strategy had laid the right foundations in terms of capital, cost, culture, customer centricity and compliance, in order for the group to move forward with better clarity.

"As the group approaches the halfway mark of its T18 Strategy, the group will fine-tune its programmes where necessary, to ensure a sustainable growth trajectory across all businesses within the group.

The group added that it is now in a “better position to advance its Asean franchise” as it has just been granted a full banking license in Vietnam, where it will begin operations in December.

Amway (M) Holdings Bhd's witnessed a 61% rise in its net profit for the third quarter ended Sept 30, 2016 (3QFY16), driven by higher sales. Net profit for the quarter stood at RM18.92 million versus RM11.78 million in 3QFY15.

Revenue rose 8% from RM241.68 million to RM261.69 million. The group also declared a third interim single-tier dividend of five sen per share for the financial year ending Dec 31, 2016, payable on Dec 15.

Amway attributed the rise in sales to higher sales impact from price increases and strong Amway Business Owner (ABO) momentum.

With that, it also expects sales to normalise in 4QFY16 as its sales in 3QFY16 were boosted by various sales and marketing programmes during the quarter. The group foresees a low- to mid-single digit growth for 2016.

It will continue investing in sales and marketing programmes, and ABO experience related infrastructure. "This, together with the impact of exchange rate resulting in higher product importation cost compared to previous year, will continue to have negative impacts on our profitability," it said.

Amway also announced the redesignation of non-independent director Liu Ming-Hsiung @ Martin Liou as its new managing director, and the appointment of Michael Jonathan Duong as its executive director, effective Jan 1, 2017.

Liu, a Taiwanese, is currently the managing director of Amway Southeast Asia, whereas Duong, an American, is currently the deputy general manager of Amway Malaysia.

Kuala Lumpur Kepong Bhd's (KLK) saw its net profit more than double to RM375.06 million or 35.2 sen per share in the fourth financial quarter ended Sept 30, 2016 (4QFY16), from RM186.29 million or 17.5 sen per share a year ago, driven by its plantation and property business sectors.

Revenue grew by 15.5% to RM4.54 billion from RM3.93 billion.

KLK announced a final dividend of 35 sen per share for the financial year ended Sept 30, 2016 (FY16), payable on March 14, 2017. Compared with FY15’s total dividend of 45 sen per share, the total dividend for the year is 50 sen per share.

Despite lower fresh fruit bunch (FFB) production and higher cost of crude palm oil (CPO) production, profits from its plantations was 20.1% higher at RM218.6 million in 4QFY16, compared with RM181.9 million in 4QFY15.

"The better profit for the quarter under review was attributed to the favourable selling prices of CPO and palm kernel," it said.

Meanwhile, its properties profit swelled by 81.2% to RM19.3 million in 4QFY16, from RM10.6 million a year ago, contributed by much higher revenue of RM60.6 million from RM21.7 million.

Going forward, KLK said the prevailing firm CPO price is supported by low palm oil stocks and weak ringgit. It expects improvement in FFB production and inventories of palm oil.

However, palm oil price “may not hold its current level”, the group said, adding that it expects the plantations profit to be satisfactory for FY17.

The business performance of the oleochemical division for FY17 is expected to be challenging in view of the continuing difficult market conditions, sluggish demand, over capacities and bullish raw material price of crude palm kernel oil.

Lower average selling price of plywood products dragged Ta Ann Holdings Bhd's net profit for the third quarter ended Sept 30, 2016 (3QFY16) by 22.8% to RM52.06 million or 11.71 sen per share, from RM67.42 million or 15.16 sen per share a year earlier.

Revenue, nevertheless, rose by 17.1% to RM349.88 million from RM298.91 million as the CPO and FFB average selling price rose by 25% and 43% respectively.

The higher revenue was also attributed to the sales volumes of plywood, CPO and FFB rising by 6%, 16% and 7% respectively.

The group declared a dividend of five sen, payable on Dec 23.

Moving into the fourth quarter of FY16, Ta Ann expects its palm oil segment to remain the main contributor of its income during the said period. "The lower than expected CPO production in the region in the 3QFY16 has led to improvement in prices which is anticipated to be carried over into the last quarter," it said.

The group is also anticipating plywood prices to recover in view of the infrastructure construction works for the coming Japan Olympics.

Meanwhile,  the group has appointed Wong Siik Onn as its executive director with immediate effect. Siik Onn is the son of its group managing director and major shareholder Datuk Wong Kuo Hea.

Boustead Plantations Bhd’s net profit for the third quarter ended Sept 30, 2016 (3QFY16) increased 58.1% to RM37.36 million or 2.34 sen per share from RM23.64 million or 1.48 sen per share a year ago, driven by better palm product prices and lower operating expenditure which compensated for shortfalls in FFB production.

Revenue stood at RM199.33 million in 3QFY16, up 19.7% from RM166.55 million in 3QFY15.

The group announced a third interim dividend of five sen for the financial year ending Dec 31, 2016, payable on Dec 14.

On the outlook for the rest of the year, Boustead Plantations said they will be driven by CPO prices and crop production. "CPO and palm kernel are expected to remain favourable whereas the blockades in the Sarawak estates and lingering moisture stress effect of El Nino will affect crop production, it said.

“The prevailing weak global economy and adverse effects of El Nino on production are expected to remain, while demand could be affected by further release of rapeseed oil reserves in China and weaker renminbi against the greenback. Nonetheless, CPO prices are expected to remain encouraging thus allaying concerns and contributing towards a positive outlook," it added.

Wing Tai Malaysia Bhd's net profit dipped 67% to RM825,000 for the first quarter ended Sept 30, 2016 (1QFY17) from RM2.56 million a year ago.

Revenue also suffered a 12% decline, dropping to RM65.6 million from RM74.3 million. This was mainly due to higher revenue contribution in 1QFY16 from the property development division, the group said.

Its property development division generated revenue of RM22.5 million in the  quarter compared with RM19 million in the preceding quarter (4QFY16), mainly driven by the sales of BM Mahkota's commercial units.

Meanwhile, revenue from its retail division was marginally lower at RM36.4 million in 1QFY17 versus RM36.6 million in the preceding quarter. However, its operating profit was higher at RM2.5 million compared with RM1.8 million in 4QFY16.

Wing Tai announced a first and final dividend of three sen per share, payable on Dec 15.