Courts Asia: Following its weak set of results yesterday, Maybank-KE maintains its Hold rating on Courts Asia with a reduced TP of $0.37, citing tepid sales in core markets amid restructuring efforts.
To recap, FY15 sales in core markets, Singapore and Malaysia, continue to remain tepid amid poor consumer sentiment. The former shrank 11% while the latter dropped 6% compared to the previous year.
In Singapore, Courts is trying to revive sales through new retail concepts, through collaboration with celebrity designers and partnerships with international brands.
In Malaysia, management intends to focus on profitability and will keep store count unchanged in the current financial year.
Its Indonesian operations also incurred estimated start-up losses of $1.3m compared to management's expectations of breakeven.
Post-results, the house cuts its FY16-17 earnings by 9% on weaker sales and sees little signs of a revival.
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