|
FEATURE
CALLS
|
|
Philippines | Cebu Air Inc
1Q17 below, but
it will get better
Mohshin Aziz
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
SGD1.96
|
|
Target
Price:
|
SGD1.97
|
|
Recommendation:
|
Hold
|
|
|
|
|
|
|
|
|
1Q results beat
estimates
|
|
1Q17 core results beat expectations with high sales volume
typically seen only in the 2H of the CY. FR capitalised on the CPO ASP
upsurge in 1Q17 and maximised sales by drawing down ~46,000 MT of
inventories. 1Q17 results may not be repeated in the remaining quarters
with recent CPO price correction. We are keeping our earnings forecasts
for now pending a briefing update. Maintain HOLD with an unchanged TP
of SGD1.97 on 17x 2017 PER, pegged at its 5-year mean.
|
|
|
|
|
|
|
FYE Dec (USD m)
|
FY15A
|
FY16A
|
FY17E
|
FY18E
|
|
Revenue
|
453.7
|
575.2
|
572.6
|
665.5
|
|
EBITDA
|
183.1
|
228.4
|
244.5
|
291.2
|
|
Core net profit
|
95.1
|
115.5
|
130.9
|
164.3
|
|
Core EPS (cts)
|
6.0
|
7.3
|
8.3
|
10.4
|
|
Core EPS growth (%)
|
(44.7)
|
21.4
|
13.4
|
25.5
|
|
Net DPS (cts)
|
1.8
|
2.1
|
2.5
|
3.1
|
|
Core P/E (x)
|
23.2
|
19.1
|
16.8
|
13.4
|
|
P/BV (x)
|
3.0
|
2.5
|
2.3
|
2.0
|
|
Net dividend yield (%)
|
1.3
|
1.5
|
1.8
|
2.2
|
|
ROAE (%)
|
10.6
|
15.5
|
14.1
|
15.9
|
|
ROAA (%)
|
5.3
|
7.1
|
7.4
|
8.7
|
|
EV/EBITDA (x)
|
13.5
|
10.1
|
9.5
|
7.7
|
|
Net debt/equity (%)
|
37.4
|
20.5
|
7.2
|
net cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
PHP103.00
|
|
Target
Price:
|
PHP120.00
|
|
Recommendation:
|
Buy
|
|
|
|
|
|
|
|
|
1Q17 below, but
it will get better
|
|
1Q17 core net income of PHP2,380m (-22.7% YoY, -25.4% YoY)
was below ours and consensus estimates due to higher maintenance and
fuel cost. The weak PHP against USD is impacting CEB as 70% of its
costs are in USD. We cut our 2017 earnings forecast by 7.5% to factor
in the weak 1Q17 and reduced TP 7% to PHP120, based on an unchanged 8x
2018 PER, which is the bottom valuation level for the typical airline
cycle of 8-15x.
|
|
|
|
|
|
|
FYE Dec (PHP m)
|
FY15A
|
FY16A
|
FY17E
|
FY18E
|
|
Revenue
|
56,501.7
|
61,899.3
|
68,507.7
|
73,140.2
|
|
EBITDAR
|
18,836.4
|
22,503.6
|
22,605.4
|
23,651.3
|
|
Core net profit
|
6,855.7
|
10,037.5
|
9,013.1
|
9,047.2
|
|
Core EPS (PHP)
|
11.31
|
16.56
|
14.87
|
14.93
|
|
Core EPS growth (%)
|
101.2
|
46.4
|
(10.2)
|
0.4
|
|
Net DPS (PHP)
|
1.50
|
3.31
|
3.08
|
3.09
|
|
Core P/E (x)
|
9.1
|
6.2
|
6.9
|
6.9
|
|
P/BV (x)
|
2.5
|
1.9
|
1.5
|
1.3
|
|
Net dividend yield (%)
|
1.5
|
3.2
|
3.0
|
3.0
|
|
ROAA (%)
|
8.5
|
10.8
|
8.3
|
7.0
|
|
EV/EBITDAR (x)
|
4.3
|
3.9
|
4.3
|
4.8
|
|
Net debt/equity (%)
|
127.8
|
97.0
|
86.1
|
106.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SECTOR RESEARCH
|
|
|
|
|
|
|
|
April stockpile still relatively tight
by Chee
Ting Ong
|
|
|
|
|
|
|
|
|
|
|
The recent CPO price rebound in May is justified given
the relatively tight stockpile scenario in Apr 2017. And healthy
demand ahead of the Eid al-Fitr celebration should help cap CPO price
on the downside in 2Q17. The relatively good upcoming 1Q17 results
release could further lift sentiment. We still think CPO price
selling pressure will resume in 2H17 when output peaks seasonally.
Our 12M Neutral sector call is unchanged. Regional BUYs are on
BPLANT, SOP, BAL, AALI, LSIP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MACRO RESEARCH
|
|
|
|
|
|
|
|
Upside surprise to growth…?
by
Suhaimi Ilias
|
|
|
|
|
|
|
|
|
|
|
Supply-side indicators suggest pick up in 1Q 2017 real
GDP growth to around +5.0% YoY (4Q 2016: +4.5% YoY) amid faster
growth in manufacturing production index and index of services, pick
up in the value of construction works done and rebound in palm oil
output – hence agriculture, despite moderation in mining activities.
|
|
|
|
|
|
Suhaimi Ilias
|
|
|
|
Zamros
Dzulkafli
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On hold but shift in tone
by
Suhaimi Ilias
|
|
|
|
|
|
|
|
|
|
|
BSP kept the policy rates unchanged at its third
Monetary Board (MB) meeting for the year on 11 May 2017. The key
policy rate – the overnight borrowing rate – was left unchanged at
3.00%, together with the overnight lending rate and overnight deposit
rate which stayed at 3.50% and 2.50% respectively. We expect +25bps
rate hike this year, either in June 2017 or in the 3Q 2017.
|
|
|
|
|
|
Suhaimi Ilias
|
|
|
|
Zamros
Dzulkafli
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robust external trade growth in 1Q 2017
by
Suhaimi Ilias
|
|
|
|
|
|
|
|
|
|
|
In Mar 2017, exports rose +21.0% YoY (revised Feb
2017: +10.0% YoY), imports gained by +24.0% YoY (revised Feb 2017:
+20.3% YoY), trade deficit widened to –USD2.3b (Feb 2017: -USD1.8b).
For 1Q 2017, exports up +18.3% YoY (4Q 2016: +1.8% YoY), imports advanced
+18.6% YoY (4Q 2016: +13.0% YoY), trade deficit was relatively
sustained at USD6.5b (4Q 2016: -USD6.7b).
|
|
|
|
|
|
Suhaimi Ilias
|
|
|
|
Zamros
Dzulkafli
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MXASJ Index approaching resistance
by Nik
Ihsan Raja Abdullah
|
|
|
|
|
|
|
|
|
|
|
FBMKLCI closed 8.83pts higher at 1,775.39 yesterday.
Market sentiment has improved, with gainers outpacing losers by 560
to 376. A total of 3.55b shares worth MYR2.48b changed hands. A
strong recovery in oil price has drawn investors back into action. Momentum
seems positive but the candlestick pattern is showing some
weaknesses. Beware of potential profit taking in the evening. We
expect the benchmark index to trade between 1,770 and 1,785 today.
Downside supports are 1,755 and 1,730.
|
|
|
|
|
|
Nik Ihsan Raja
Abdullah
|
|
|
|
Tee Sze Chiah
|
|
|
|
|
|
|
|
|
|
|
|
NEWS
|
|
|
Outside Malaysia:
U.S: Rebound in wholesale prices signals inflation
pressures. The bigger-than-forecast rebound in April wholesale prices
indicates inflation pressures continue to build in the U.S. economy and
that March’s decline was short-lived, Labor Department data showed.
Producer-price index increased 0.5% (forecast was 0.2% rise) following a
0.1% decline the prior month. Wholesale prices rose 2.5% YoY, the most
since February 2012 (forecast was 2.2%), after 2.3% gain. PPI excluding
food and energy rose 0.4% from the prior month and was up 1.9% YoY from
April 2016. (Source: Bloomberg)
E.U: Raises Euro-area growth forecast with risks more
balanced. Growth in the Euro area will be slightly stronger this year
than previously forecast, the European Commission said, adding that some
risks to the outlook have eased following the defeat of populist parties
in France and the Netherlands. The commission sees the 19-nation economy
expanding 1.7% this year -- up from 1.6% forecast in February -- and
growing 1.8% in 2018. In its first set of economic forecasts since the
U.K. triggered its exit from the European Union, the commission said that
risks to euro-area growth are more balanced, though they remain tilted to
the downside. (Source: Bloomberg)
Brazil: Records largest retail sales drop in over two
years. Brazil’s retail sales fell more than expected in March after a
sharp downward revision to the previous month, suggesting consumers are
still struggling to recover from two years of recession. Sales dropped
1.9% from February, the worst result in more than two years. The February
data was revised to a 1.6% drop from the 0.2% fall previously reported.
Compared with March of 2016, sales sank 4% YoY. (Source: Bloomberg)
|
|
|
|
|
|
|
Other News:
Kerjaya Prospek: Gets MYR207m Shah Alam property project.
Its unit has accepted a MYR207.36m contract to undertake a property
development project in Shah Alam. The development is for the main
building works for the project which included 99 three- storey bungalows,
166 three-storey semi-detached house and one two-storey club house along
Persiaran Anggerik Oncidium, Seksyen 31, Shah Alam. (Source: The Star)
Mitrajaya: Bags MYR160.1m construction job. The group has
bagged a MYR160.1m contract to build residential buildings for a higher
learning institution here. The project will commence on May 18 for
duration of 24 months and is expected to be completed by May 2019.
(Source: The Edge Financial Daily)
T7 Global: Forms JV to manufacture high-value metal treatment.
Its wholly-owned T7 Aero S/B has formed a 60:40 joint venture with KOV
Ltd, a wholly-owned unit of Kilgour Metal Treatments Ltd, to pursue
high-value metal treatment manufacturing. The company, known as T7
Kilgour Sdn Bhd, will build, operate and set up a metal treatments plant
in Malaysia to pursue high-value manufacturing businesses in metal
treatments, the group said. (Source: The Edge Financial Daily)
Three-A: 1Q net profit increases 54.26% on higher product
margins, lower foreign currency losses. Net profit for the first quarter
ended March 31, 2017 (1QFY17) rose by 54.26% to MYR10.32m from MYR6.7m a
year ago. The company attributed the increase in earnings to higher
product margins and lower foreign currency losses of MYR39,000 compared
with MYR1.15m a year ago. The company also announced a bonus issue of
98.4 million new shares on the basis of one bonus share for every four
shares held on the entitlement date of May 25, 2017. (Source: The Edge
Financial Daily)
|
|
|
|
|
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.