Friday, August 6, 2010

Notion VTec down 14c in late morning

KUALA LUMPUR: Shares of Notion VTec fell as much as 14 sen in the morning session on Friday, Aug 6 after the company announced a set of weaker earnings and stayed cautious about the fourth quarter.

At 11.19am, it was down 14 sen to RM2.06 with 1.68 million shares done.
The FBM KLCI fell 1.87 points to 1,360.21. Turnover was 333 million shares done valued at RM335 million.

On Thursday, Notion VTec reported net profit of RM2.97m in its 3Q ended June 30, 2010, down sharply from the RM11.1 million a year ago as earnings were impacted by the initial start-up cost of new projects and it is cautious about its 4Q.

CIMB Research said on Friday in view of the earnings uncertainty, poorer-than-expected execution, loss of investor confidence and rising industry risk, "we are cutting Notion from Outperform to Underperform".

The research house said the poor results are a potential de-rating catalyst, along with a longer-than-expected recovery/gestation period and slowdown of the overall hard disk drive market.

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