For the third quarter ended 30 September, Globetronics Technology’s net profit rose 16.5 percent to RM17.7 million, on the back of improved revenue, which grew 14.3 percent to RM91.1 million.
The improvements in top and bottom lines were attributed to healthy sales in Singapore and Malaysia, as well as better economy of scale and cost control.
For the nine-month period, earnings improved 24.2 percent to RM49.1 million, while revenue climbed 9.1 percent to RM265.1 million.
Significance: For the quarter, Globetronics has declared a dividend of RM0.11 per share (3Q13: RM0.09). Going forward, the group said it would focus on climbing up the value chain and riding on research and development initiatives in new product design and development, while it continues to improve efficiency and reduce costs.
Maybank IB Reiterates ‘Sell’ On NCB As Net Profit Slumps
For the third quarter ended 30 September, NCB Holdings reported a net loss of RM2.3 million (3Q13: RM27.3 million net profit), bringing 9M14’s net profit to RM5.3 million, down 90.7 percent and substantially below estimates by the street and Maybank Investment Bank (Maybank IB).
The disappointing results were due to poor performance in both the port and logistics divisions, dragged by local and transhipment segments as well as lower business activities in certain business streams.
Maybank IB has also lowered its dividend per share expectation for FY14 to FY16 to RM0.04, RM0.06 and RM0.10 respectively in view of the group’s growing net debt of RM151.3 million (3Q13: RM32.7 million net cash), which suggests a yield of only 1.5 percent for FY14.
Significance: The research house has maintained its ‘Sell’ call on NCB and has lowered the target price to RM2.25 from RM2.62 previously.
SMTrack Enters US Joint Venture
SMTrack has entered into a joint venture with two individuals in the US, Michael Maragh and Marc Thomas, to fast-track its core traceability business in designing and commissioning one of the very first embedded traceability bottling plant.
Upon satisfactory completion of the due diligence by the firm, Maragh and Thomas will transfer 100 percent and 75 percent of their shares in MRH Capital and California Bottling Co (CBC) respectively in a share swap arrangement in exchange for a total of 40 million new shares in Smartag International, a 94 percent-owned unit of SMTrack.
SMTrack expects to further benefit from the procurement contracts obtained by MRH whereby it would also be able to export exclusively all niche drinking and health water produced by MRH, especially for the China markets, and with traceability.
Significance: The proposed joint venture, which is expected contribute positively to the firm’s future earnings, would be funded through internally generated funds and/or debt and/or through a capital raising exercise to fully meet the financial commitments if SMTrack were to exercise the option and expand the traceable plant facilities at CBC. - Shares Investment
