Period 4Q12
Actual vs. Expectations
Full year net profit (NP) of RM132m was in line, making up
96% of both the street’s estimate and our forecast of RM138m.
Dividends No dividend was declared in the quarter.
Key Result Highlights
YoY, revenue up by 10% underpinned by higher sales recorded
in the integrated livestock farming (“ILF”) (+13%), palm oil activities (“POA”)
(+8%) and marine products divisions (“MPM”) (+4%).
The strong growth registered in ILF was mainly due to higher
farm products price and higher unit cost of feed raw materials.
A substantial PBT margin expansion was seen in POA, which up
by 2.4ppt to 3.7% in FY12, has cushioned the margins squeeze in both MPM and ILF
divisions. The improved PBT margin in POA was mainly attributed to higher
contribution from its own estates and associate companies.
However, higher depreciation and effective tax have dragged
down the group’s FY12 NP margin by 0.2ppt to 6.8% to RM132m (+6% YoY).
Overall performance for the year was not exciting as the
mid-single digit NP growth rate was on the lower end as compared to the double
digits YoY growth rate in previous years.
Outlook Nonetheless, we continue to like QL Resources
for its leadership in the MPM and livestock businesses, and its plantation
division is starting to bear fruits.
Change to Forecasts
Maintained FY13-14E NP forecast of RM168mRM196m.
Rating MAINTAIN OUTPERFORM
Valuation Our target price for the stock is retained
at RM3.68 based on 18.5x PER over FY13 FD EPS of 19.9sen.
Risks The global economic and weather uncertainty could
affect the earnings of the company.
Source: Kenanga
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