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Date : 14 DEC 2017
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THE STOCK & TARGET
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Current Price : RM3.58
Stock : George Kent (Malaysia) Berhad - GKENT
Target : GKENT (1st) RM3.80 & (2nd) RM4.20
Call warrant : GKENT-CA (0.17 cts) : TP more than 0.30cts +++ '100%'
This stock has been alerted and called by Kim personally on 29 September 2017 at RM3.12. You may refer screenshot below :
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WHAT KIM SAY?
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1. " I
forsee this company will continue to grow and its already have strong
order book and deliver the projects in hand towards meeting their
customers’ expectations and continue to improve shareholders’ value. The
TS Chairman and the board is optimistic of next year 2018 as their
strong order book provides sustainable earnings visibility going
forward. This stock already surpass my important line at RM3.30 so then anytime blast to my target..”Good luck! " - Kim Spartan
2."
As the boss said they will continue to execute on their strong order
book of RM5.83 billion to deliver value to their shareholders. Noted
also continue to look out for new opportunities in both the Engineering
and Metering sectors"
3. "George Kent is a key rail play with exposure to the LRT extension, LRT3 and MRT2..." - Kim Spartan
3. "George Kent is a key rail play with exposure to the LRT extension, LRT3 and MRT2..." - Kim Spartan
4." Give it chance and be patient in 7 days from today, you will see my near TP or RM3.70 test.. " - Kim Spartan
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THE PROFILE
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George Kent (Malaysia) Berhad an
investment holding company, engages in the manufacture and marketing of
water meters, waterworks fittings, fiber glass reinforced polyester
panel tanks, and various hot-stamped brass products and components in
Malaysia and internationally. The company also markets industrial
measurement and automatic control products, compressed air pumping and
heating equipment, valves, and pipes and pipeline fittings. In addition,
it is engaged in the design, supply, installation, commissioning, and
maintenance of instrumentation, process control systems, and Scada
systems for industries, as well as building automation and building
security systems. Further, the company is involved in mechanical and
electrical turnkey water infrastructure project management, and also
operates and maintains a water treatment plant. It exports its products
to Singapore, Thailand, Vietnam, Myanmar, Cambodia, Indonesia, the
Philippines, Papua New Guinea, Australia, Hong Kong, Sri Lanka, Kenya,
South Africa, and the United Kingdom. George Kent (Malaysia) Berhad was
founded in 1936 and is based in Puchong, Malaysia.
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THE KEYNOTE
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DEC 2017GKENT - Net profit for the third quarter ended Oct 31, 2017 (3QFY17) rose 21% year-on-year to RM28.68 million, from RM23.74 million, driven mainly by sales of water metres locally. The company said revenue for the quarter rose 4% to RM127.09 million, from RM122.09 million a year earlier. Earnings per share for the quarter rose to 5.10 sen, from 4.20 sen previously. George Kent declared a second interim dividend of 2 sen per share, amounting to RM11.27 million, to be paid on Jan 12, 2018.
GKENT - George Kent has yet to book in any significant project delivery partner (PDP) fees for the LRT3 project. While this is the case, share of joint venture profits (from the PDP role) increased 81% y-o-y to RM8.9 million which was mostly due to reimbursables for initial works undertaken. Thus far, six viaducts and one depot package for the LRT3 project has been awarded totalling RM7.1 billion. Recognition of the PDP fees should gain traction in FY19.
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JAN - NOV 2017
GKENT - Planning
a two-to-three share split, posted a 114% surge in net profit for the
fourth quarter ended Jan 31, 2017 (4QFY17) to RM42.15 million, from
RM19.66 million a year earlier, as gross profit improves, while cost of
sales shrank. It also recorded higher unrealised gain on foreign
exchange of RM1.85 million on foreign currencies held. Its quarterly
revenue, however, was down 29% to RM189.14 million from RM265.58 million
a year ago, mainly as its construction and metering segments'
contributions fell.
GKENT - Reported
a 100% year-on-year increase in net profit to RM101.41mil for FY17, on
the back of record contributions from its engineering and water metering
divisions. The group’s total revenue for the year rose 12% to
RM598.97mil compared with RM536.2mil in FY16.
GKENT - Has
secured contracts amounting to RM1.1bil in FY17, enlarging its order
book to RM6.2bil. This translates to a superior cover ratio of 10.4
times on FY17 construction revenue.
GKENT - Delivered
a strong set of financial results for its first quarter ended Arpil 30,
2017, with earnings up 23.3% to RM18.49mil while its order book has
grown to RM6.1bil. It reported earnings rose from RM15mil a year ago.
Earnings per share were 4.9 sen compared with four sen a year ago. Its
revenue increased by 5.2% to RM129.42mil from RM122.96mil a year ago.
GKENT - They
said capital expenditure this year would run into several million and
it is an ongoing exercise. The company, which presently derives some 80%
of its revenue from the construction division, plans to switch its
listing status to the construction sector from the trading and services
sector on Bursa Malaysia. The sale of water meters contributes to the
remainder of the revenue.
GKENT - Tendering
for about RM4 billion worth of projects ranging from railways to
hospitals, as the group progresses with its RM6.1 billion outstanding
order book. They also highlighted that Singapore’s national water agency
Public Utilities Board has made its third consecutive contract since
2012, with an order for 323,000 units, while the group has also secured
another contract for 600,000 units from Hong Kong.
GKENT - The group has RM95 million in outstanding orders for the water meter business.
GKENT - Has
won for the second time, a US$6.86 million (RM28.72 million) tender bid
to supply water meters to the Water Supplies Department of Hong Kong.
The latest contract entails George Kent’s subsidiary, George Kent
International Pte Ltd, delivering 650,000 DN15 Brass PSM-T water meters
across 24 shipments in two years.
GKENT - The
only company that has simultaneously secured large water meter
contracts from both Hong Kong and Singapore water authorities both
renowned for their stringent standards in water meter evaluations.
GKENT - Second
quarter earnings ended July 31 was 23.7% stronger at RM25.37mil from
the previous corresponding quarter, on the back of 18% stronger revenue
of RM187.57mil. This brought the group's first half net profit to
RM43.87mil, 23.5% higher compared to the first half of 2016. Revenue for
the period stood at RM316.99mil, 10% higher from the year-ago period.
The group has declared a dividend of 2.5 sen per share for Q2, with ex
and entitlement dates set on Oct 11 and 13, 2017, respectively.
GKENT - Partnering
Siemens Aktiengesellschaft, Germany, and Siemens Pte Ltd, Singapore,
for the Kuala Lumpur to Singapore High Speed Rail (HSR) tender. They and
Siemens will form an engineering, procurement and construction (EPC)
pre-consortium to prepare a joint offer on EPC level to the special
purpose company which shall bid for the development, financing,
construction and technical operation and maintenance of the Kuala
Lumpur-Singapore HSR. The agreement may lead to the participation of the
company in the Kuala Lumpur-Singapore HSR project, which could
contribute positively to the company's earnings and net assets in the
future.
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THE FINANCIAL
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THE PROJECTS
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Their current projects as below :
No. |
Project Title |
Client Name & Contact |
Contractual Commencement Date |
Contractual Completion Date |
Scope of Works |
|---|---|---|---|---|---|
|
1
|
Ampang Light Rail Transit (LRT) Line Extension Project
|
Prasarana Malaysia Berhad
|
31/07/2012
|
Fully operational and officially launched on 30 June 2016
|
The engineering, procurement, construction, testing and commissioning of System Works
|
|
2
|
Proposed Upgrading Hospital Kuala Lipis Phase II
|
Ministry of Health
|
23/10/2014
|
23/04/2017
|
Design, construction, equipping, commissioning and maintenance of 56-bed Hospital
|
|
3
|
Mount Eriama Water Treatment Plant, Port Moresby, Papua New Guinea
|
Eda Ranu, Port Moresby Papua New Guinea
|
June 1997
|
2019
|
Operation & maintenance of Mount Eriama Water Treatment Plant
|
|
4
|
Construction and Completion of Light Rail Transit Line 3 (LRT3) from Bandar Utama to Johan Setia
|
Prasarana Malaysia Berhad
|
04/09/2015
|
2020
|
Procurement and appointment of consultants and contractors
including preparation of pre-qualification and tender documents,
supervision and management of consultants and contractors appointed to
carry out the development of the entire LRT3 including design, value
engineering, manufacture, deliver, install, test, commission and making
good defects of Systems Works, Track Works and all other Infrastructure
Works with the aim of ensuring delivery of Project
|
|
5
|
Construction and Completion of MRT Sungai Buloh-Serdang-Putrajaya Work Package SSP-SY-2014
|
MASS Rapid Transit Corporation Sdn Bhd
|
August 2016
|
2022
|
Engineering, procurement, construction, testing and
commissioning of Trackworks, maintenance of Vehicles and Work Trains
|
|
6
|
Design and Build 150-Bed District Hospital in Tanjung Karang
|
Public Works Department, Malaysia, Ministry of Works
|
November 2016
|
November 2020
|
Design & build 150-bed Medical and Ward Block, 30 units of
Houseman’s Quarters, 24 units of Class “F” and “G” Quarters, 50-Pax
Child Nursery Centre, Engineering Block, Cafeteria and Visitor Gallery, 2
Fully Equipped Operating Rooms (OR)
|
|
7
|
Design and Build 220-Bed Endocrine Hospital in Precinct 7, Putrajaya
|
Public Works Department, Ministry of Works
|
December 2016
|
January 2020
|
Design and construction of 220-bed Hospital Extension Complex
with Link Bridge to existing Main Block of Hospital Putrajaya and
Multi-Storey Car Park
|
Regards,
Kim Stockwatch
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