Author: cuntoinews | Publish date: Sat, 26 Aug 2017, 12:49 AM
25 August 2017, Kajang, Selangor, Malaysia - Construction and largest
JKR contract dependance public listed company Protasco Bhd saw the year
to year Quarter 2 net profit further plunge 45% from RM14.36mil to
RM7.9mil, and cash and cash equivalents at the end of financial year
plunge a jaw dropping 81.7% from RM32.9mil to RM6mil.
Revenue year to year drop from RM396mil to RM219mil, net profit margin
crashed to just 3.6%. Total liabilities improved to RM696mil, with bank
borrowing of RM346mil. Net asset per share stood at RM0.9475. Notable
financial highlights as follows:
Bank Borrowed Cash Balance?
In order to keep the "cash and cash equivalents" stays positive at
RM6mil, the company had increased bank overdraft from RM19.98m to
RM47.31m Y-to-Y, or increase of 236%.
Inflated Net Profit, Where It Comes From?
Exclude "extra-ordinary" accounting adjustment in property development
division amounted to RM3.89m, net profit would only fetch RM4.01m (*1).
(*1.
Q2'17 report, Note 14, page 7: For the period ended 30 June 2017, the
revenue for Property Development segment decreased significantly mainly
due to the completion of all development projects and deferment of new
projects given the softening of the property market. Accordingly, PBT
decreased by 24%. PBT for the current quarter increased more than 100% as compared with preceding year corresponding quarter due to reversal of development expenditure from previous completed projects.)
Segmental Highlights
Construction segment revenue and PBT decreased by 46% and 67% respectively for the period ended 30 June 2017, mainly due to cost overrun for certain ongoing infra projects, completion of PPA1M Phase 1 in the 1st Quarter of 2017 and delay in commencement of PPA1M Phase 2.
Change of Substantial Shareholders
Last quarter saw the exit of fund managers including Great Eastern
Holdings Limited and OCBC despite management promised better results
quarter after quarter since year 2014 until today, and borrowed money to
keep up with dividends. EPF however took up bulk of the shares sold by
fund managers, likely linked to certain unhappy investors. EPF further
purchased the shares riding on share price down trend. As of todate (25
Aug 2017), EPF held 36,040,340 shares, or close to 8.49%. EPF seems to
be very pleased with the declining share price and likely to continue
pair down the investment if the price continues to break new low.
Where the Money Really Goes?
Recall the hidden cost & benefit changes year to year in Q1'17,
where profit attributable to "Equity holders of the Company" drop from
RM13.3mil to RM3.3mil, and "Non-controlling Interests" had ballooned
from 16.9% to 34% of total profit, or RM2.7mil to RM1.7mil year to year,
which is a significant 100% increase of "money out flows" to parties
outside of Protasco. This quarter saw similar trend, where
"Non-controlling Interests" stood at 31.6% of total profit, which means
the bulk money out flow is here to stay permanently.
Analysts which had been following Protasco since year 2014 under Chong
Ket Pen stewardship, saw the vanish of cash flows and thinning profit
margin across all sectors, including road maintenance, construction and
property development.
Trailing Q1'17 until Q2'17 there is no sign of better profit margin,
which means the low margin environment is likely to stay, especially
with the roll over of low margin projects using new debt to covers old
debt, raising red flag among fund managers whether or not to continue
betting on the low cash flow businesses. Such environment might affect
Protasco future earnings and sustainability, especially vulnerable to
material cost and variation risk especially in construction sector.
There is extra political factor haunting this government project
dependence company especially towards General Election.
Protasco had not much room for dividends for this quarter, after last
quarter eke out of 3 Sen dividends, or RM12,726,342, using borrowed
money. Over the years of borrowed-money-dividend policy, 1/4 of Protasco
money shall goes to single largest shareholder Chong Ket Pen. Such cash
out flow is about 212% of cash and cash equivalents on hand as of 30
June 2017 (Q2).
Such borrowed-dividend had been intensified since year 2014. Here is
the last 3 years result card pertaining to "where the money goes" based
on the Y-to-Y performance for year 2014, 2015 and 2016 as follows (RM):
Cash & Short Term Investments 285m 256m 211m
- Latest Q2'17 Cash balance stood at 6m
Total Current Liabilities 448m 538m 877m
Total Debt 187m 337m 557m
Total Liabilities 593m 849m 996m
Source: Financial Times
BizT
http://www.bursamalaysia.com/market/listed-companies/company-announcements/5526377
Quarterly rpt on consolidated results for the financial period ended 30 Jun 2017
| PROTASCO BERHAD |
| Financial Year End | 31 Dec 2017 |
| Quarter | 2 Qtr |
| Quarterly report for the financial period ended | 30 Jun 2017 |
| The figures | have not been audited |
- Default Currency
- Other Currency
Currency: Malaysian Ringgit (MYR)
SUMMARY OF KEY FINANCIAL INFORMATION
|
INDIVIDUAL PERIOD
|
CUMULATIVE PERIOD
|
||||
CURRENT YEAR QUARTER
|
PRECEDING YEAR
CORRESPONDING QUARTER |
CURRENT YEAR TO DATE
|
PRECEDING YEAR
CORRESPONDING PERIOD |
||
30 Jun 2017
|
30 Jun 2016
|
30 Jun 2017
|
30 Jun 2016
|
||
$$'000
|
$$'000
|
$$'000
|
$$'000
|
||
| 1 | Revenue |
219,762
|
396,244
|
351,934
|
523,341
|
| 2 | Profit/(loss) before tax |
16,266
|
30,889
|
22,990
|
54,033
|
| 3 | Profit/(loss) for the period |
11,554
|
19,864
|
16,570
|
35,880
|
| 4 | Profit/(loss) attributable to ordinary equity holders of the parent |
7,899
|
14,364
|
11,197
|
27,714
|
| 5 | Basic earnings/(loss) per share (Subunit) |
1.86
|
4.53
|
2.64
|
8.74
|
| 6 | Proposed/Declared dividend per share (Subunit) |
0.00
|
5.00
|
0.00
|
5.00
|
AS AT END OF CURRENT QUARTER
|
AS AT PRECEDING FINANCIAL YEAR END
|
||||
| 7 | Net assets per share attributable to ordinary equity holders of the parent ($$) |
0.9475
|
0.9257
|
||
Definition of Subunit:
In a currency system, there is usually a main unit (base) and subunit that is a fraction amount of the main unit.
Example for the subunit as follows:
Example for the subunit as follows:
| Country | Base Unit | Subunit |
| Malaysia | Ringgit | Sen |
| United States | Dollar | Cent |
| United Kingdom | Pound | Pence |
Announcement Info
| Company Name | PROTASCO BERHAD |
| Stock Name | PRTASCO |
| Date Announced | 25 Aug 2017 |
| Category | Financial Results |
| Reference Number | FRA-21082017-00002 |
