AEON's FY12  earnings  were  largely  in  line  with  consensus  and  our  forecasts. Revenue  and  core  net  profit  grew  by  9.1%  and  14.7%  y-o-y  respectively, underpinned  by  retail  and property management's solid performance.  A  23  sen gross DPS and 1 sen special tax exempt dividend were proposed. We are bumping up our FY13 forecast marginally by 1.9%, to reflect the better property management margin. Maintain NEUTRAL, with a new FV of 11.80 based on 18x FY13 EPS.

Largely  in  line.  Healthy  revenue  growth  from  both  its  retail  and  property  management divisions lifted up AEON's turnover by 9.1% y-o-y. Retail revenue grew by 8.2% y-o-y due to contributions from new stores and a higher number of loyalty cardmembers' sales days while  higher  property  management's topline (+15.3%)  came  from  the  opening  of  new shopping  centres,  higher  occupancy  and  rental  rates  from  a  tenants  revamp.  Core earnings  increased  by  14.7%  y-o-y,  where  the  better  PBT  from  property  management (+26.9%)  helped  to  mitigate  the  drop  in  retail's PBT (-5.6%).  Retail  segmental  profit  was lower  due  to  higher  operating  costs  including  initial  costs  associated  with  new  store operations.  Vis-à-vis  last  quarter,  revenue  expanded  by  3.3%  while  net  profit  leaped  by 66.5% y-o-y mainly due to higher revenue and the margin generated in the current quarter.

Source: OSK