Journey to Wealth
Multi-Purpose Holdings - OUTPERFORM - 28 May 2012
Period 1Q12
Actual vs. Expectations
1Q12 results were within expectations with a net profit of RM83.7m, which made up 23% of our and consensus' FY12 full year estimate.
The difference between the actual result and our estimate was due to poor luck factor (66.7% vs. 63%) and a higher effective tax rate. (30% vs. 25%).
Dividends No dividend was declared as expected.
Key highlights
1Q12 net profit dipped 5% YoY to RM83.7m as revenue slid 3% YoY, mainly due to lower ticket sales (-3% YoY) and higher estimated prize payout ratio (EPPR) of 66.7% vs. 61.2% previously.
Average ticket sales dropped 3% YoY to RM18.7m in 1Q12. The number of draw days remained the same at 45.
Financial Services reported a 1Q12 PBT of RM2.3m, which plunged 88% YoY (from RM18.5m previously) due to higher net claims.
QoQ, 1Q12 headline net profit contracted 68% from RM260.1m in 4Q11 as there was an exceptional gain of RM199.6m in Dec 2011 from the sale of Menara MPHB. Ex-EI, 4Q11 core net profit was at RM60.5m.
Ticket sales rose 5% QoQ in 1Q12 due to the CNY effect as average ticket sales jumped 7% despite having one less draw day at 45 in 1Q12 from 46 previously.
However, the luck factor was poorer in 1Q12 as EPPR increased to 66.7% from 64.1% in the preceding quarter.
Outlook 2Q12 ticket sales are expected to be weaker QoQ as 1Q is seasonally a strong quarter. Nonetheless, the company is still on track to meet our full year forecast.
The demerger is expected to unlock the group's value while dividend is set to rise higher on the back of its 80% dividend payout policy.
Change to Forecasts
No changes to our forecasts for now.
Rating MAINTAIN OUTPERFORM
Valuation Maintaining price target of RM3.72/share, based on a 10% holding company discount to its RNAV.
Risks A rise in gaming tax by the government
Weaker than expected ticket sales and a higher than expected EPPR.
Source: Kenanga
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
