Multi  Sports  FY12  results  were  well  within  our  forecast.  Revenue  and  earnings moderated  by  10.7%  and  22.9%  y-o-y  respectively  due  to  lower  orders  and  higher production costs. We are ceasing coverage on Multi Sports due to internal resource reallocation.  

Within expectation. Multi Sports' FY12 revenue and earnings slipped by10.7% and 22.9% y-o-y  respectively.  Production  capacity  stood  at  45m  pairs  p.a.,  with  a  utilization  rate  of 79.4%.  Sales  for  TPR,  RB,  MD1  and  MD2  dropped  by  34.3%,  14.3%  15.7%  and  7.1% respectively. Margins were lower, largely thanks to higher production cost arising from rises in  labor  and  overhead  costs.  Q-o-q,  revenue  grew  by  4%  while  net  profit  was  lower  by 6.2%. The lower profitability was partially due to losses from the disposal of property, plant and  equipment  and  the  preliminary  start-up  expenses  incurred  by  a  newly-incorporated subsidiary in the current quarter.
  
Ceasing  coverage.  We  are  discontinuing coverage  on  the stock due  to internal  resource allocation.  We  expect  the group's margins,  which  eased  y-o-y,  to  remain  flat  in  the  near future amid higher labour and overhead costs.  

Source: OSK