Period 4Q12/FY12
Actual vs. Expectations FY12 core net profit* of RM90m makes up 139% of
consensus forecast (RM65m) and this is above consensus expectation. It is also
better than our expectation at 131% of our forecast of RM69m.
Delayed FFB yield recovery in Sabah and Kalimantan
has caused 4Q12 FFB volume to be exceptionally high. In addition, TSH
refineries JV registered better than expected PBT of RM11m in 4Q12 (against
9M12 PBT of only RM9m).
Dividends As
expected, single tier dividend of 2.5 sen was announced.
Key Results Highlights YoY, FY12 core net profit declined 21% to RM90m
as CPO prices was down 9% to RM2749/mt. Better FFB volume at 425k mt (+6%)
mitigated the eanings decline.
QoQ, 4Q12 core net profit jumped 80% to RM35m
as FFB volume surged 37% to 140,828 mt while refineries margin improved. These
has more than enough to counter CPO prices of RM2170/mt (-24% QoQ) based on
MPOB data.
Outlook Despite
the better than expected FY12 results, the current low CPO prices should keep
share price upside limited.
Our FY13E earnings estimate remains unchanged as
we already assume FFB volume to grow by 31% YoY to 558k mt.
Change to Forecasts Maintain FY13E-FY14E earnings of RM104mRM160m.
Key assumptions are FY13E-FY14E CPO price of RM2500-RM2700 per mt.
Rating Maintain MARKET PERFORM
Valuation Maintain
our TP to RM2.00 based on an unchanged Fwd. PER of 16.3x to the CY13E EPS of
12.3 sen.
Risks Worse
than expected CPO prices.
Source: Kenanga
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