SG Market (28 Feb 14)

Market Roundup: US stocks closed at fresh highs with the S&P 500 breaking past the key 1,850 technical level after new Fed chair Janet Yellen told a Senate panel that the central bank will stay the course to scale back its stimulus measures but may consider pulling back the tapering if the economy falters. Investors were also reassured by her view that the harsh weather could be a factor in the recent run of tepid economic data, including weaker durable goods orders (-1%) for Jan and higher weekly jobless claims. But gains were held in check by tensions at the Ukaraine border with Russia, which took a toll on European shares. S’ppore shares may inch higher, taking the lead from Wall Street but any rise in the the STI is likely to big overhead resistance at 3,150 level with downside support at 3,070. Stocks to watch: *ST Engineering: Flat FY13 results were in line with estimates with net profit of $580.8m (+0.8%) trailing revenue of $6.63b (+4%), which was mainly buoyed by the marine sector. Notably, the group delivered strong sequential growth in 4Q13, punching a net profit of $167.5m (+27% q/q) on higher revenue of $1.94b (+25% q/q) across all key divisions. End Dec order book swelled to $13.2b, of which $4.3b is expected to be booked in 2014. Final plus special DPS of 12¢ proposed, taking its full year payout to 15¢, down from 16.8¢ in FY12. *Bumitama Agri: Robust set of results as 4Q13 with net profit surging 65.9% y/y to Rp380.5b on a 30.4% increase in revenue Rp1,299b, largely attributable to higher CPO (+29%) and palm kernel (+69%) prices as sales volume was relative flat. Consequently, gross margins widened to 45% vs 35% in 4Q12. Bottomline was further enhanced by a 66% drop in finance costs to Rp11.8b, which benefitted from lower interest rates. FY13 net profit rose 8.6% to Rp855.5b, while revenue climbed 15.2% to Rp4,062.7b. NAV was Rp3,494 as at end Dec. *IndoAgri: Firm 4Q13 results. Revenue grew 13% y/y to Rp3.75t, driven by strong recovery in crop prices and higher sales volume of palm products and branded edible oil products. Net profit jumped 32% to Rp255b, on improved gross margin of 31.8% from 28% a year ago, as operating profit surged 53% to Rp769b boosted by higher plantation contribution. However, FY13 revenue fell 4% to Rp13.3t mainly due to lower edible oil sales, while net profit plunged 49% to Rp550b, mainly due to lower gross profit in tandem with lower average selling prices as well as FX losses. Group will pay a first and final dividend, to be decided by end Mar (FY12: 0.85¢). *Mewah Int’l: 4Q12 net profit inched up 2.9% y/y to US$9.3m, taking FY13 net profit to US$20.9m (-15.6%). Revenue rose 8.2% to US$830.9m as a 17% rise in sales volume was dampened by the 7.5% drop in average selling prices. Gross margins improved to 7.9% from 6.7%, which was largely attributable to gains from derivative financial instruments amounting to US$18.2m. But bottomline was hit by a ten-fold increase in FX losses to of US$8.5m. Final DPS of 0.73¢ declared, bringing total FY13 payout to 0.85¢ (same as FY12). *Yongnam: FY13 net profit slumped 87% y/y to $5.5m despite a 20% increase in revenue to $361.6m, of which structural steelwork (+63%) contributed almost 60%. But gross margin contracted 14.6 ppt to a dismal 10.5% on poor revenue mix and cost overruns from three ongoing structural steelwork projects. G&A expenses ballooned to $31m (+28.3%) on a $8.1m dispoal loss and $5.1m bad debt. But order book swelled from $229m in 3Q13 to to $340m, of which 54% is expected to be completed in 2014. DPS of 0.6¢ proposed vs 1¢ in previous year. *Ho Bee Land: 4Q13 and FY13 net profit swelled to $506.1m (+657% y/y) and $591.8m (+216%) respectively, boosted by fair value gains on investment properties of $493.1m, mainly from newly completed The Metroplis at One-North and $47.2m gain from disposal of shares in Chongbang Holdings in early 2013. Revenue slumped 75% to $56.2m in 4Q13 as property development sales dived 80% to $43.7m following the completion of Trilight and One Pemimpin in 2012, while rental income from The Metropolis contrinuted $12.5m (+362%). NAV/share ballooned $0.90 to $3.48 as at end Dec. Total DPS of 8¢ compares to 5¢ in FY12. *CSE Global: 4Q13 net profit from continuing operations fell 6.6% y/y to $6.5m as revenue rose 17% to $129m, due to a project cost overrun. This brought FY13 earnings to $30.4m (+5.5%) on revenue of $416m (-7.2%). Despite the cost overrun, gross margin improved to 26.8% in 4Q13 from 24.5% a year ago. Taking into account goodwill written off of $27m and disposal gain of $90.4m, 4Q13 net earnings would jump to $72.3m. New orders secured totaled $93.4m (-36%), taking year end order book to $227.2m (-18%). Final plus special DPS of 3¢ declared, bringing FY13 payout to 32.5¢ vs 4.25¢ in FY12. *Haw Par: FY13 net profit declined 10% to $107.9m on rather flat revenue of $141.2m (+1.3%), buoyed by a better performance from healthcare (+13%) but offset by lower sales from the leisure division (-32%). Operating profit rose 14% to $96.6m on higher contributions from healthcare and dividend income (+13.7%) but the gains were erased by a 58.4% drop in associate contributions to $8m, and lower fair value gains to $10.7m vs $23.5m in FY12. NAV climbed 8.1% to $11.18 per share. Final DPS of 14¢ declared, taking total FY13 payout to 20¢ from 18¢ in previous year. *GLP: Signs two leases totaling 19,000 sqm at GLP Atsugi (14,000 sqm) and GLP Misato III (5,000 sqm) in Greater Tokyo, Japan to third-party logistics providers. Both facilities are under its 50% JV GLP Japan Development Venture. *Jardine C&C: FY13 net profit fell 7% to US$915m, while revenue slid 8% to US$19.8b with 50.1% owned Astra contributing underlying profit of US$849m (-13%). Heavy equipment and mining profit contributions led the decline (-24%), as weaker coal prices led to lower Komatsu heavy equipment sales. Automotive contributions fell 9%, while that for financial services was 2% higher. Final DPS of US90¢ proposed, bringing full year payout to US$1.08 (FY12: US$1.23). *Centurion: 4Q13 net profit leapt 422% y/y to $26.9m, while revenue remained flattish at $17.6m, as accommodation business which grew 20% was offset by a 30% reduction in optical disc business. Gross margins improved to 55% from 50% as in line with the higher-margin accommodation business growth. Bottomline was buoyed by share of associates of $16m (vs $2.5m loss in FY2012), contributed by the worker’s dormitory in Mandai, which had a fair value gain of $14.7m on its investment property. Final DPS of 0.6¢ declared (vs 0.7¢ for FY2012) *KrisEnergy: FY13 net loss narrowed the gap by 93.6% to US$12.6 mil, although revenue was 22.9% lower at US$69.1m, primarily attributed to the cessation of gas and condensate production from the Kambuna gas-condensate field on 11 Jul. Revenue was also affected by disruptions in oil and gas productions. Bottomline was buoyed by other income which increased 770.4% to US$16.2, mainly due to negative goodwill from the Block 9 purchase amounting US$12.9m