Pos Malaysia posted strong 9MFY13 earnings, with a cumulative core net profit ofRM112.9m (YTD: +48%, q-o-q: 71%, y-o-y for 3QFY13: 119%), in line with our estimates but again beat consensus forecasts. The commendable growth was mainly led by the courier segment and a smaller-than-expected natural drop in mail revenue. The performance of the group was also buoyed by lower retail cost. Given the positive outlook, we maintain our BUY call, with our RM4.14 FV unchanged.
More good numbers. Pos Malaysia posted strong 3QFY13 results, reporting a net profit of RM51.7m (+71% q-o-q, +119% y-o-y, +48% YTD) on the back of 4.3% q-o-q and 8.2% y-o-y revenue growth (YTD: +6.4%). The 9M cumulative core net profit of RM112.9m was in line with our expectations but trumped consensus estimates, accounting for 70%/82% of the respective full-year earnings forecasts. The upcoming quarter is a traditionally stronger q-o-q, with the festive season expected to drive up its courier and mail volumes.
Courier segment sees rapid growth. The courier segment chalked up a robust 25.9% q-o-q and 188% y-o-y growth in operating profit toRM21.9m in 3QFY13 on the back of 17% q-o-q and 34.1% y-o-y increases in revenue. The numbers were buoyed by higher sales from on-demand customers, contract customers, parcels and express mails due to brisk online business transactions as well as extended operating hours. While mail revenue grew by 1.6% q-o-q and 0.4% y-o-y, the division’s profit margin slipped 1.7 ppts y-o-y to 14.1% due to higher operating expenses, notably for staff and transportation. Meanwhile, shrinking operating costs amid strict cost discipline, coupled with higher agency commissions, reduced overall losses at the retail segment. Note that due to the high allocation for staff and operating expenses, it is a norm to see the retail division in the red.
Maintain BUY. We think the company’s outlook remains positive as it diversifies its income sources amid a declining mailing segment. Its retail portion is also gaining pace, driven by growth in its pawn broking and other agency services. That said, we retain our earnings forecasts and RM4.14 FV. Our sum-of-parts valuation incorporates the value of the group’s landbank. Based on the stock’s last closing price, our FV still offers a potential upside of 19%. Maintain BUY.
More good numbers. Pos Malaysia posted strong 3QFY13 results, reporting a net profit of RM51.7m (+71% q-o-q, +119% y-o-y, +48% YTD) on the back of 4.3% q-o-q and 8.2% y-o-y revenue growth (YTD: +6.4%). The 9M cumulative core net profit of RM112.9m was in line with our expectations but trumped consensus estimates, accounting for 70%/82% of the respective full-year earnings forecasts. The upcoming quarter is a traditionally stronger q-o-q, with the festive season expected to drive up its courier and mail volumes.
Courier segment sees rapid growth. The courier segment chalked up a robust 25.9% q-o-q and 188% y-o-y growth in operating profit toRM21.9m in 3QFY13 on the back of 17% q-o-q and 34.1% y-o-y increases in revenue. The numbers were buoyed by higher sales from on-demand customers, contract customers, parcels and express mails due to brisk online business transactions as well as extended operating hours. While mail revenue grew by 1.6% q-o-q and 0.4% y-o-y, the division’s profit margin slipped 1.7 ppts y-o-y to 14.1% due to higher operating expenses, notably for staff and transportation. Meanwhile, shrinking operating costs amid strict cost discipline, coupled with higher agency commissions, reduced overall losses at the retail segment. Note that due to the high allocation for staff and operating expenses, it is a norm to see the retail division in the red.
Maintain BUY. We think the company’s outlook remains positive as it diversifies its income sources amid a declining mailing segment. Its retail portion is also gaining pace, driven by growth in its pawn broking and other agency services. That said, we retain our earnings forecasts and RM4.14 FV. Our sum-of-parts valuation incorporates the value of the group’s landbank. Based on the stock’s last closing price, our FV still offers a potential upside of 19%. Maintain BUY.
Source: OSK
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