Alam Maritim’s (Alam) FY12 net profit came in above our and consensus expectations, due to better-than-expected contributions from its associates and jointly-controlled entities. We retain our BUY recommendation for now, with the fair value (FV) unchanged at RM1.25, pegged to 13x FY13 EPS. The key downside risk lies with its offshore, installation and construction (OIC) and subsea businesses as Alam has yet to receive any contracts this year, which may lead to a downgrade of their FY13 earnings by end-1Q13.
Above expectations. Alam’s FY12 net profit came in above our and consensus’ expectations, accounting for 129.9% of our and 117.2% of consensus’ full year estimates. Revenue grew 62.9% y-o-y and 43.5% y-o-y due to a significant increase in contributions
from its OIC business (supported by its contract with Samsung Engineering and Sarawak Shell). While the results are positive, Alam’s EBIT pluged 42.3% y-o-y and the company incurred operational losses in 4Q12, but was boosted by contributions from its jointly controlled entities and associate companies (+>100% y-o-y and q-o-q). We believe that the operational losses may be attributable to losses from its subsea business.
from its OIC business (supported by its contract with Samsung Engineering and Sarawak Shell). While the results are positive, Alam’s EBIT pluged 42.3% y-o-y and the company incurred operational losses in 4Q12, but was boosted by contributions from its jointly controlled entities and associate companies (+>100% y-o-y and q-o-q). We believe that the operational losses may be attributable to losses from its subsea business.
Source: OSK
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