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Share
Price:
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MYR1.09
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Target
Price:
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MYR1.10
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Recommendation:
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Hold
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Diversification
& evolution
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MPR organised an investor day entitled ‘Inside Out’ on 17
May 2017. The key message was that MPR needs to diversify its
operations and evolve with the times. Targets have been set and MPR did
not discount more M&As to achieve those targets. We are positive
that MPR has an action plan but opine that it is too early to quantify
its impact yet. Our estimates are unchanged pending the 1Q17 results
due on 29 May. Our MYR1.10 TP, based on 0.9x ex-goodwill BVPS, is also
unchanged for now.
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FYE Dec (MYR m)
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FY15A
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FY16A
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FY17E
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FY18E
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Revenue
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1,427.7
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1,289.0
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1,372.0
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1,444.5
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EBITDA
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325.8
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163.6
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181.0
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195.4
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Core net profit
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138.7
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38.7
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68.0
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82.8
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Core EPS (sen)
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12.5
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3.5
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6.1
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7.5
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Core EPS growth (%)
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(2.4)
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(72.1)
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75.5
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21.8
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Net DPS (sen)
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10.0
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8.0
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8.0
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6.0
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Core P/E (x)
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8.7
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31.2
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17.8
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14.6
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P/BV (x)
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0.7
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0.8
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0.8
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0.8
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Net dividend yield (%)
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9.2
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7.3
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7.3
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5.5
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ROAE (%)
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8.6
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(3.8)
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4.7
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5.7
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ROAA (%)
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5.8
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1.7
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3.3
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4.2
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EV/EBITDA (x)
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4.0
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7.5
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6.9
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6.3
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Net debt/equity (%)
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net cash
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net cash
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2.1
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1.0
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Samuel Yin Shao
Yang
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Jade Tam
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NEWS
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Outside Malaysia:
U.S: Trump trade-deficit review looks at industries big
and small. The Trump administration is looking at options big and small
to re-balance American trade. The U.S. Commerce Department will listen to
a wide range of representatives from catfish farmers to manufacturers and
even the National Football League during a day-long hearing on how to
reduce the country’s USD 750b merchandise trade deficit. President Donald
Trump has ordered his administration to study the causes of trade
deficits as part of his wider agenda to bring back home U.S.
manufacturing jobs. Included in that review, the Commerce Department is
holding the public sessions in which 35 individuals are scheduled to
testify about their ideas for reducing the trade gap. (Source: Bloomberg)
Mexico: Unexpectedly raises rate to avoid inflation
spreading. Mexico’s central bank unexpectedly raised its key interest
rate for a sixth straight meeting to keep an increase in consumer prices
from deepening after inflation accelerated to almost double policy
makers’ target. Banco de Mexico, led by Governor Agustin Carstens, lifted
its benchmark by a quarter point to 6.75%, surprising most of the
economists surveyed by Bloomberg. (Source: Bloomberg)
U.K: Retail sales gained more than expected in April as
nice weather prompted Britons to splurge on their homes and gardens. The
volume of goods sold in stores and online increased 2.3% after a 1.4%
drop in March, the Office for National Statistics said. Average
store-price inflation slowed. The data suggest consumer spending, the
mainstay of economic growth, is holding up in the face of rapidly
increasing food and fuel costs. Retail sales declined for the first
quarter in seven years in the three months through March. (Source:
Bloomberg)
Indonesia: Central bank left its benchmark interest rate
unchanged for a seventh month as inflation heads closer to the top of the
target band. Governor Agus Martowardojo and his board held the seven-day
reverse repurchase rate at 4.75%. The bank went on a cutting spree last
year as it lowered rates six times, but has been on hold since the last
move in October. (Source: Bloomberg)
Australia: Jobless rate fell in April, adding to the
previous month’s strong employment gains, reinforcing expectations that
the central bank won’t cut interest rates further. Employment rose 37,400
from March. Jobless rate fell to 5.7%, the lowest since January.
Full-time jobs fell 11,600; part-time employment rose 49,000.
Participation rate held at 64.8% vs forecast 64.7%. The unexpectedly
strong result bolsters the central bank’s view that the labor market is
starting to gather steam, even though the data series is notoriously
volatile. The Reserve Bank of Australia is looking for improved jobs and
wage growth to pull core inflation back into its 2-3% target band, but is
mindful of record high underemployment. (Source: Bloomberg)
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Other News:
Press Metal: 1Q net profit up 56.6%, pays 1.5 sen
dividend. Net profit jump 56.6% to MYR148.05m in the first quarter ended
March 31, 2017 (1QFY17), from MYR94.56m a year ago, mainly due to higher
production output generated by its Samalaju Phase 2 smelting plant in
Sarawak and improved metal price. Quarterly revenue grew 56.7% to
MYR2.02b in 1QFY17, from MYR1.29b in 1QFY16. Press Metal also declared a
first interim dividend of 1.5 sen per share for financial year ending Dec
31, 2017 (FY17), payable on June 21. (Source: The Edge Financial Daily)
JCY International: Reports 2nd profitable quarter in a
row, declares 1.25 sen dividend. Reported a net profit of MYR15.41m in
its second quarter ended March 31, 2017 (2QFY17), compared with a net
loss of MYR6.43m a year ago, due to favourable U.S. dollar to ringgit
exchange rate in the current reporting period. The group declared a
second interim dividend of 1.25 sen per share for financial year ending
Sept 30, 2017, with the entitlement and payment dates to be announced
later. (Source: The Edge Financial Daily)
Tomypak Holdings: 1Q surges 78.3% on increased demand,
declares 2 sen dividend. Its net profit for its first financial quarter
ended March 31, 2017 (1QFY17) surge 78.3% to MYR6.26m, from MYR3.51m a
year ago, on higher demand from its local and overseas customers,
improved production cost, and lower foreign exchange losses. Tomypak
declared a dividend of 2 sen per share to be paid on June 16, to
shareholders whose names appear on the record of depositors on June 2.
(Source: The Edge Financial Daily)
Century Logistics: 1Q profit strengthens 9%. Posted a 9%
rise in net profit to MYR4.85m in the first quarter ended March 31, 2017
(1QFY17), versus MYR4.46m a year ago, on higher contribution from its
total logistics services segment. Revenue was up 2% to MYR71.03m, from
MYR69.54m a year ago (1QFY16), on higher activities from the same
segment. (Source: The Edge Financial Daily)
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