KUALA LUMPUR: OSK Research said Adventa's 1QFY11 results were below expectations, mainly due to the continuous rise in the latex price.
It said on Friday, April 1 this had affected the company's ability to pass on 100% of the cost increase to its customers in a timely manner.
'We are downgrading our FY11-12 earnings by 20%-26% respectively. Hence, our target price is also lowered to RM3.04, in line with our earnings downgrade. Maintain Buy,' it said.
Adventa's net profit for the first quarter ended Jan 31, 2011 fell by 55.6% to RM4.05 million from RM9.35 million a year earlier due to historical high material cost and the price adjustment lag based on previous month/previous quarter cost index.
Revenue for the quarter however rose to RM106.19 million from RM76.64 million in 2010. Earnings per share were 2.65 sen while net assets per share was RM1.42.
It said on Friday, April 1 this had affected the company's ability to pass on 100% of the cost increase to its customers in a timely manner.
'We are downgrading our FY11-12 earnings by 20%-26% respectively. Hence, our target price is also lowered to RM3.04, in line with our earnings downgrade. Maintain Buy,' it said.
Adventa's net profit for the first quarter ended Jan 31, 2011 fell by 55.6% to RM4.05 million from RM9.35 million a year earlier due to historical high material cost and the price adjustment lag based on previous month/previous quarter cost index.
Revenue for the quarter however rose to RM106.19 million from RM76.64 million in 2010. Earnings per share were 2.65 sen while net assets per share was RM1.42.
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