MIDF Sector Research

Author: sectoranalyst   |   Latest post: Fri, 15 Nov 2019, 9:10 AM


Tasco Berhad - Cold Supply Chain Business Proves Its Worthiness

Author:   |    Publish date:


  • FY19 results below expectations
  • International segment PBT dented by ocean freight forwarding division
  • Performance of domestic segment cushioned by cold chain logistics
  • Expect stronger contribution in cold supply chain logistics in FY20 following the value accretion from JOIN’s 30% acquisition
  • Revise earnings downwards to reflect higher costs associated with the convenience retail logistics business and lower contribution from the ocean freight forwarding segment.
  • Maintain trading BUY with revised TP of RM1.68 per share

FY19 normalised PATAMI below estimates. Tasco recorded FY19 normalised PATAMI of RM11.9m (-44.4%yoy). This was below our and consensus estimates, representing 86.0% and 81.6% of the full year forecasts respectively. The negative variance was attributed to the start-up costs for their convenience retail logistics business combined with higher finance costs for the new cold chain logistics business, and increased professional and compliance expenses for corporate merger & acquisition exercises. Nevertheless, post-FY19, we expect finance costs to gradually decrease following the cost savings from the 30% divestment.

International segment PBT decreased by -45.7%yoy in FY19. Tasco’s ocean freight forwarding business slumped into the red with an annual loss before tax of -RM3.5m as existing clients opted for direct shipment booking. Meanwhile, Tasco’s air freight forwarding PBT advanced by +173.0%yoy mainly due to the increased volume from aerospace manufacturers and capacitor manufacturing clients which offset the discontinuation of a major E&E client. This helped pared the overall PBT decline in the international segment.

Domestic segment cushioned by CSC business. The contract logistics segment posted a -56.5%yoy drop in PBT despite the +8.8%yoy revenue increase. The growth in revenue was due to increased contribution from its solar panel and music instrument partner. However, this was offset by the start-up expenses and additional costs to cater for the seasonal volume surge under its newly secured convenience retail logistics business. In contrast, losses of the trucking division narrowed down by -65.0%yoy amidst continuous cost reduction measures. We also note that the PBT of the cold supply chain business rose by +79%yoy, cushioning the -32%yoy decline in domestic segment profitability.

Source: MIDF Research - 30 May 2019

Share this
Labels: TASCO

Related Stocks

Chart Stock Name Last Change Volume 
TASCO 1.18 -0.01 (0.84%) 1,000 

  Be the first to like this.


211  161  551  1373 

Top 10 Active Counters
 SAPNRG 0.295+0.005 
 ARMADA 0.51+0.02 
 DGB 0.17+0.005 
 ISTONE 0.205-0.02 
 IFCAMSC 0.545+0.015 
 HSI-C7K 0.34+0.005 
 HSI-H8F 0.395-0.025 
 SAPNRG-WA 0.135+0.005 
 VELESTO 0.385+0.005 
 EKOVEST 0.775+0.005 


1. [转贴] 为什么有人看不上股息收入,有人却靠收股息达成财务自由?!- 陈剑 Good Articles to Share
2. Malaysia Construction – ECRL: Package 2 Set for Take Off KL Trader Investment Research Articles
3. Technical View - MTAG Group Bhd (MTAG, 0213) Rakuten Trade Research Reports
4. COMMENTS ON ALLIANCE BANK BERHAD (2488) - louisesinvesting Good Articles to Share
5. Minister: Govt to provide RM20.7b in cash, incentives over five years for digitalisation save malaysia!!!
6. (Icon) Alliance Bank - One Off Provision Affected Previous Quarter Earning. Time To Buy On Weakness Icon8888 Gossips About Stocks
7. PublicInvest Research Headlines - 14 Nov 2019 PublicInvest Research
8. [12Invest] - 我要投资 - 浅谈Dayang(5141) Right Issue [12Invest] - 我要投资
Partners & Brokers