Journey to Wealth
United Malacca - OUTPERFORM - 28 June 2012
Period 4Q12 and FY12
Actual vs. Expectations
Broadly in line, FY12 net profit of RM85.9m made up 88% of the consensus forecast of RM97.5m and 92% of our forecast of RM93.0m.
FFB production is 6% below our expectation as the tree stress impact has been greater than expected.
Fertilizer cost has also turned out to be higher than expected.
Dividends A final dividend of 16 sen was announced (single tier, ex-date 12th of Sept 2012). Together with the interim dividend of 10 sen announced earlier, the total net dividend in FY12A is 26 sen (dividend yield of 3.6%).
Key Results Highlights
YoY, FY12 net profit increased 5% to RM85.9m due to a better FFB production (+11% YoY) and better CPO prices (+6% YoY).
YoY, 4Q12 net profit declined 46% to RM12.3m due to higher fertilizer costs and a lower FFB production caused by the tree stress impact.
QoQ, 4Q12 net profit decreased 42% to RM12.3m as a result of lower FFB production seasonally.
Outlook Fertiliser cost increase should moderate in FY13E.
Note that crude oil prices have softened to an average of US$93.50/barrel per barrel in 2QCY12 (vs. 1QCY12: US$103/barrel).
Change to Forecasts
FY13E-FY14E earnings cut by 5%-4% respectively to RM111m-RM114m.
FFB volume for FY13E-FY14E has been reduced by 2%-1% respectively to account for tree stress.
Assuming now higher fertiliser costs for both FY13E-FY14E by 3%-5% respectively.
Rating Maintain OUTPERFORM
UMCCA net dividend yield of 4.5% is the highest among planters under our coverage.
The average age profile of ~8 years old means the strong FFB growth can be sustained.
Valuation We have lowered our Target Price to RM7.70 (from RM8.00) based on an unchanged 14.1x Fwd PER on a lower FY13E EPS of 54.5 sen (previously 57.3 sen).
Risks Sustained drop in CPO prices.
Higher than expected fertiliser costs.
Source: Kenanga
Related Stocks
| Chart | Stock Name | Last | Change | Volume |
|---|
More articles on Journey to Wealth
Ekovest: No plan to launch another offer for Iskandar Waterfront City
Created by kiasutrader | Mar 29, 2018
Kenanga Research - On our Portfolio - Parliament dissolution around the corner?
Created by kiasutrader | Mar 25, 2013
Plantation Sector - Proposed accounting standard scrapped OVERWEIGHT
Created by kiasutrader | Mar 25, 2013
Pavilion Reit - Limited upside, earnings upside have been priced in HOLD
Created by kiasutrader | Mar 25, 2013
Discussions
Be the first to like this. Showing 0 of 0 comments
Post a Comment
Featured Posts
Introducing MY's First IPO Fund for Sophisticated Investors!
New Update. Discover investment communities that resonate with your ideas
M & A Value Partners IPO Equity Fund has been launched - Targeted 13% Return p.a
Latest Videos
MQ Trading Signals
Time
Signal
Duration
Type
2024-11-05 15:35:00
EMA 5
5 Mins
SELL
2024-11-05 15:25:00
ADX
5 Mins
SELL
2024-11-05 15:25:00
TURTLE SYSTEM 20
5 Mins
SELL
2024-11-05 15:25:00
TURTLE SYSTEM 55
5 Mins
SELL
2024-11-05 15:20:00
OBV
10 Mins
SELL
Apps
Top Articles
1
2
save malaysia!
4
5
6
Stockhistory
7
BFM Podcast
8
BFM Podcast
#
Stock
Score
Daily Stocks
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Featured Advertisers / Partners
Ride The Bull Short The Bear
CS Tan
4.9 / 5.0
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....
