Capital markets news summary for Wed 22 Feb 2023
Capital markets news summary for Wed 22 Feb 2023
AAX posts RM153m net profit with 50% fleet activated
The results for the quarter ended 31 Dec 2022 showed revenue increasing to RM339.3m by carrying 337,638 passengers. Average base fare was a record high of RM866 supported by pent up demand for air travel post-Covid. Ancillary revenue per passenger was up 19% from the same period in 2019 to RM196. Passenger load factor of 79% is almost the same level – above 97% – as in 2019. Cost per available seat kilometre (CASK) is 9.98 sen down 25% from 2019, while CASK excluding fuel is 1.42 sen down 83%. These were contributed by the revised cost structure post-restructuring. Revenue per available seat kilometres grew 53% from 13 sen in 2019 to 19.96 sen. The company plans to have 17 A330s active in its fleet by end-2024 from 14 planes in 2022 of which 7 were active. The counter closed at 68 sen.
Boustead Plantations net profit surge 147%
The company posted net profit of RM595.31m in 2022 from RM241.29m the previous year. Revenue was up from RM1.05b in 2021 to RM1.18b in 2022. Higher crude palm oil prices and the disposal of Kulai Young land contributed to the performance. The sale proceeds helped reduce borrowings with debt-to-equity ratio down from 0.37 times in 2021 to 0.29 times. Dividends are up from 8.35 sen to 14.45 sen. Palm oil stock levels in Malaysia and Indonesia have been forecast to improve following the increase in mature areas, better weather conditions and improved labour supply. The counter closed at 68 sen.
DRB-Hicom’s revenue climbed 25.32% in 2022
The company registered revenue of RM15.51b in 2022 up from RM12.38b the prior year. Net profit was RM187.71m in 2022 compared with a loss of RM296.42m a year ago. The sectors which contributed to the spectacular results were automotive (+35.2% from RM8.2b in 2021 to RM11.09b in 2022), aerospace and defence (+41% to RM874.91m in 2022), and banking (+13.7% to RM1.27b). Proton sold 141,432 units up 23.3% – the best figure since 2013 – while other brands also experienced strong demand supported by the government’s sales tax holiday. Bank Muamalat’s results were contributed by higher financing income and volume from property and personal financing. The counter closed at RM1.69.
Indonesian mining company considers raising USD1b via IPO
PT Amman Mineral Internasional owns the second largest copper and gold mine in Indonesia with 25,000 hectares of concession area containing 8m tonnes of copper and 678 tonnes of gold reserves. The company’s mine in Batu Hijau, on the Island of Sumbawa east of Java, has produced 4m tonnes of copper and 247 tonnes of gold since starting operations in 2000. They are currently working on an IPO in 1H2023. So far, Indonesia’s IPO market has seen USD656m worth of deals. PT Pertamina Geothermal Energy will list on Fri raising USD596m. PT Nusantara Sejahtera Raya, which operates Indonesia’s largest movie theatre chain Cinema XXI, is contemplating an IPO to raise USD1.1b.
Morgan Stanley’s Michael Wilson says that S&P 500 may fall 26% in 1H2023
He says that the equity risk premium has entered into a death zone. This makes risk-reward very poor with the Federal Reserve’s monetary tightening expected to continue and earnings expectations being 10%-20% too high. He foretells that the S&P 500 may fall from currently 4,209 to 3,000, although most investors are currently very bullish. He suggests consolidating before the next earnings reports are out.
