Period 4Q12/12M12
Actual vs. Expectations
4Q12 results came in
within our expectations and that of the consensus. The 12M12 net profit of RM83m
also came in within our full year expectations and the consensus at 97% and 94%
respectively.
Dividends No dividend was declared during the quarter.
Key Result Highlights
FY12 revenue and net
profit dropped by 28% and 14% respectively. This was due mainly to the slower recognition
for the sale of one parcel of land in Melaka which Benalec had already
recognised its reclamation cost in the books. The transaction is, however,
expected to be recognised in FY13. For the year, Benalec chalked up a RM68m
gain from its reclaimed land sales.
QoQ, the net profit
fell by 24% on the back of a 14% drop in revenue. This was mainly due to lesser
construction revenue recognised and the absence of land sales during the
quarter.
YoY, the revenue and
net profit declined by 62% and 53% respectively due to slower recognition of construction
works and also the Melaka land sale.
Outlook We
understand that management is currently working closely with oil and gas majors
to clinch partnership deals to develop its Johor reclamation land. We expect
more news on this matter in the near term.
We also understand
that the EIA study for the Johor land development will be wrapped up by the end
of this year.
Nonetheless, we have
toned down our bullish estimate on the order book replenishment for FY13 from
RM300m to RM150m as we are now assuming a longer take-up time for its land
reclamation works in Johor (Tanjung Piai).
Forecasts We
have revised down our FY13E earnings by 14% as we assumed a lower order book
replenishment of RM150m. We are also
introducing our FY14E earnings of RM131m with an order book replenishment
assumption of RM200m.
Rating Maintain OUTPERFORM
Maintain OUTPERFORM
given the ample capital upside from the current price (+75%) and its positive
Johor land development prospect.
Valuation We
have cut our TP to RM1.81 from RM2.37, based on SOP valuation.
Risks Slowdown in land sales (reclaimed lands).
Source: Kenanga
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