AEON’s FY12 earnings were largely in line with consensus and our forecasts. Revenue and core net profit grew by 9.1% and 14.7% y-o-y respectively, underpinned by retail and property management’s solid performance. A 23 sen gross DPS and 1 sen special tax exempt dividend were proposed. We are bumping up our FY13 forecast marginally by 1.9%, to reflect the better property management margin. Maintain NEUTRAL, with a new FV of 11.80 based on 18x FY13 EPS.
Largely in line. Healthy revenue growth from both its retail and property management divisions lifted up AEON’s turnover by 9.1% y-o-y. Retail revenue grew by 8.2% y-o-y due to contributions from new stores and a higher number of loyalty cardmembers’ sales days while higher property management’s topline (+15.3%) came from the opening of new shopping centres, higher occupancy and rental rates from a tenants revamp. Core earnings increased by 14.7% y-o-y, where the better PBT from property management (+26.9%) helped to mitigate the drop in retail’s PBT (-5.6%). Retail segmental profit was lower due to higher operating costs including initial costs associated with new store operations. Vis-à-vis last quarter, revenue expanded by 3.3% while net profit leaped by 66.5% y-o-y mainly due to higher revenue and the margin generated in the current quarter.