NCB  Holdings’  1QFY13  core  earnings  of  MYR33.3m  were  within expectations. Revenue was weaker on lower container throughput while its  outlook  remains  challenging  due  to  the  intense  competitive environment. No dividends were declared for the quarter. That said, we maintain  our  BUY  call,  given the stock’s steady dividend growth and decent dividend yields. Our FV is unchanged at MYR5.38.

Largely  in  line. NCB’s 1QFY13 core net profit of MYR33.3m (-19.8% y-o-y, +91.2% q-o-q) came in largely in line with our and street estimates. Its revenue nudged down 4.7% y-o-y to MYR230.9m, mainly due to lower container  throughput  handled  by  Northport  for  the  quarter  under  review. Total  container  handled  was  675,755  teus  (twenty-foot  equivalent  units) vs  748,742  teus  in  the  same  period  last  year  (-9.7%  y-o-y).  Meanwhile, its logistics operations saw its revenue slipped 2.6% q-o-q to MYR77.4m, 
but suffered narrower losses of MYR2.1m in terms of PBT compared with a MYR4.0m loss in the previous quarter. 

Continues  to  face  challenges.  Although  its  throughput  yields  have improved  by  5%  y-o-y  in  1Q  to  MYR227.2  per  container  handled,  NCB continues  to  face  challenges  in  the  competitive  environment  as  well  as uncertainties  in  the  regional  container  trade.  Nevertheless,  with  its  new 8A berth coming on-stream in 3Q and new businesses emerging from its logistics  segment,  we  think  that  NCB  should  be  better  equipped  to weather such challenges in the future.

Revised  intangible  asset  estimates.  NCB  highlighted  that  the  Group has revised the estimated useful lives of certain intangible assets, which came after the extension of its port concession period for the license and lease  of  the  privatized  port  services,  namely  30  years  for  Northport  and 21  years  for  Southpoint.  As  such,  the  intangible  assets  are  now amortized  over  the  remaining  lease  period  on  a  prospective  basis  with effect from 1 Jan 2012.

Source: RHB