Period 4Q12/12M12
Actual vs. Expectations The FY12 core net profit of RM260m came in
below our expectations, accounting for 83% and 80% of our forecast and that of
the consensus respectively. This was due to higher operating costs in its water
business. There was a RM22m net impairment write-down in FY12 for its
receivables (due from Selangor State Government) and long term payables for its
concession.
Dividends No
dividend was declared during the quarter.
Key Result Highlights The FY12 core net profit of RM260m was much better
as compared to the last year loss of RM8m. The last year’s loss was mainly due
to impact of its first-time adoption of the new accounting standard for
concession assets, i.e. IC12: Service Concession Agreement. The revenue
meanwhile increased by 44%. The positive growth was attributed to the higher
revenues at its oil & gas as well as construction segments.
YoY, the core net profit was higher by almost
fourfold from RM9m to RM35m due to the contribution of its oil and gas division
and from construction as there was more progress on site and a higher order book
replenishment.
QoQ, the revenue came down by 5% due to a
lower contribution from its oil and gas division. Its core net profit was halved
from the previous quarter to RM35m, due to the higher operating cost on its water
business. The margin fell to 8% as compared to 27% in 3Q12.
Outlook The
election risk remains as the main risk for Puncak Niaga due to the
uncertainties of the upcoming General Election. The recent offer for Puncak
could have valued it RM2.43 per share.
Change to Forecasts We have
trimmed our FY13E estimates slightly by 7% as we factored in a higher cost.
Rating Maintain
OUTPERFORM
Maintaining our OUTPERFORM rating due to uncertainties
from the upcoming general election but we opine that Puncak is will be best
suit for our Dark Horse strategy.
Valuation We are
maintaining our TP at RM2.85 (based on SOP).
Risks Prolonged water consolidation process.
Source: Kenanga
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