KUALA LUMPUR: Tomypak shares were the top loser in later afternoon trade on Friday, Aug 20 after its annualised first half (ended June 30, 2010) core net profit missed CIMB Research's forecast by 25%.

At 3.41pm, it was down 28 sen to RM3.36 with 757,600 shares done. CIMB Research said it was retaining its Outperform call on Tomypak despite the earnings shortfall. It said the company's 1H 2010 core net profit missed its forecast by 25% as the second quarter earnings before interest, taxation, depreciation and amortisation (EBITDA) margin squeeze from higher raw material prices, was worse than expected. Also below expectations was the interim DPS of 1.4 sen, which took year-to-date dividend per share to 4.9 sen.

'We are cutting our FY10 earnings per share (EPS) and dividend per share (DPS) by 9.6% in view of the poor interims. However, we are keeping our FY11-12 EPS forecasts given the continued strong demand and expected margin recovery from stable raw material costs in 3Q,' it said.

CIMB Research said Tomypak remained an Outperform with an unchanged target price of RM4.96, based on a 30% discount to its 12 times target price-to-earnings for Daibochi.

Factors that could catalyse the stock include margin recovery and stronger-than-expected revenue growth in the next few quarters as well as the approved share split and bonus issue.