Muhibbah order book at RM3.08b

KUALA LUMPUR: Muhibbah Engineering Bhd's secured order book totalled RM3.08 billion as at Aug 19, 2011 which was sufficient to take the company into 2014.

It said on Friday, Aug 26 that of the RM3.08 billion, the infrastructure CONSTRUCTION [] division's order book was RM2.21 billion, cranes division art RM675 million while the shipyard division had RM194 million.

Announcing its second quarter results for the period ended June 30, 2011, it said net profit rose 28.1% to RM13.82 million from RM10.78 million. Revenue increased by 10.7% to RM513.10 million from RM463.28 million while earnings per share were 3.46 sen compared with 2.73 sen.

Muhibbah said in the first half, its net profit doubled to RM32.02 million from RM16.08 million but revenue increased by 3.8% to RM907.44 million from RM873.85 million.

When compared with the first quarter, it reported an increase of 77% consolidated profit after tax to RM36.86 million for the period ended June 30, 2011 compared to RM20.79 million a year ago.

'This is mainly due to better results from the infrastructure construction division and the cranes division,' it said.

On the receivership involving its major customer, Asia Petroleum Hub Sdn Bhd (APH), it said the receivership was uplifted in August. 'APH then continues its process of negotiation with investors to inject fund to complete the project,' it said.

Glenealy 4Q net profit surges eight-fold to RM18.3m

KUALA LUMPUR: Gleneany PLANTATION []s (Malaya) Bhd net profit for the fourth quarter ended June 30, 2011 surged eight fold to RM18.3 million from RM2.05 million a year earlier, due mainly to higher production and increased crude palm oil sales.

It said on Friday, Aug 26 that revenue for the quarter jumped 85.6% to RM76.86 million from RM41.42 million a year earlier.

Earnings per share was 16.04 sen compared to 1.79 sen in 2010.

Glenealy proposed a first and final gross dividend of 15 sen per share totaling RM12.84 million.

For the financial year ended June 30, Glenealy's net profit surged 239% to RM71.31 million from RM29.76 million a year earlier, on the back of revenue RM258.66 million compared to RM189.53 million in 2010.

Reviewing its performance, Glenealy said that in terms of segmental results, Sabah and Sarawak operations achieved operating profit of RM85.3 million and RM51.6 million respectively.

The company said it planted an additional 2,747ha of oil palm plantation in Sarawak, taking total planted area in East Malaysia to 29,346ha, of which 20,927ha had matured as at June 30.

On its prospects, Glenealy said that two years of subdued production, palm oil production had picked up strongly in the current quarter.

It said the strong production coincided with a general downturn in commodities prices due to risk aversion from concerns over the debt crisis in the EU and slower world economic growth.

It said the outlook for palm oil price was stable but under pressure due to potential increase in supplies for palm oil as well as other oilseeds.

'Palm oil is trading at a good discount of above US$100 per tonne to soyabean oil, which is encouraging additional demand that hopefully can keep a lid on palm oil stocks to prevent a further rose that will be bearish for palm oil price.

'At current prices, the performance of the group for the current financial year is expected to remain favourable,' it said.

Singapore's GIC buys into Parkson

KUALA LUMPUR: The Government of Singapore Investment Corporation Pte Ltd has emerged as a substantial shareholder in PARKSON HOLDINGS BHD [] with a 5.03%.

According to a filing to Bursa Malaysia, the Singapore GIC acquired 55.028 million shares as at Aug 24, Wednesday.

The shares of the department store operator were acquired from the open market.

RHB Research Institute is maintaining its Outperform recommendation on Parkson.

In its recent research note, it said its sum-of-parts derived fair value was unchanged at RM6.40.

'Due to Parkson's positive results and its positive growth outlook, we reiterate our Outperform call on the stock,' it said.

RHB Research said Parkson's FY06/11 core net profit of RM345.9 million (up 10.1% on-year) was in line with its and consensus estimates, accounting for 100% and 98% of its and consensus full-year forecasts respectively.

U.S. second-quarter growth revised down to 1 pct

WASHINGTON: The U.S. economy grew much slower than previously thought in the second quarter as business inventories and exports were less robust, a government report showed on Friday, Aug 26, although consumer spending was revised up.

Gross domestic product growth rose at annual rate of 1.0 percent the Commerce Department said, a downward revision of its prior estimate of 1.3 percent. It also said after-tax corporate profits rose at the fastest pace in a year.

Economists had expected output growth to be revised down to 1.1 percent. In the first quarter, the economy advanced just 0.4 percent. The government's second GDP estimate for the quarter confirmed growth almost stalled in the first six months of this year.

The United States is on a recession watch after a massive sell-off in the stock market knocked down consumer and business sentiment. The plunge in share prices followed Standard & Poor's decision to strip the nation of its top notch AAA credit rating and a spreading sovereign debt crisis in Europe.

While sentiment has deteriorated, data such as industrial production, retail sales and employment suggest the economy could avoid an outright contraction.

The GDP report comes as central bankers from around the globe gathered for a conference in Jackson Hole, Wyoming.

Federal Reserve Chairman Ben Bernanke will deliver the keynote address on Friday, which will be watched for any sign a further easing of U.S. monetary policy is on the way to support the ailing economy.

The downward revisions to second-quarter growth came as businesses accumulated less stock than previously estimated. Business inventories increased $40.6 billion instead of $49.6 billion, cutting 0.23 percentage point from GDP growth during the quarter.

However, the slow build-up of inventories means goods are not piling up on shelves, which should support growth in the third quarter. Excluding inventories, the economy grew at a 1.2 percent rate.

Output was also curbed by exports, which grew at a 3.1 percent pace instead of 6.0 percent. Imports increased at a 1.9 percent rate rather than 1.3 percent. That left a slightly wider trade deficit and trade barely contributed to GDP growth. Trade had previously been estimated to have added 0.58 percentage point to overall output.

The drag from business inventories was offset by consumer spending, which was revised up to a 0.4 percent rate from 0.1 percent. The increase in spending, which accounts for more than two-thirds of U.S. economic activity, was still the smallest since the fourth quarter of 2009.

Business spending was revised to a 9.9 percent rate of increase from 6.3 percent as investment in nonresidential structures and equipment and software was stronger than previously estimated. But there are fears that the recent stock market rout could make businesses a bit hesitant to spend on capital and hiring.

The report also showed that after-tax corporate profits increased 4.1 percent in the second quarter after edging up 0.1 percent in the first three months of the year. It also showed inflation pressures abating, with the personal consumption expenditures price index rising at a 3.2 percent rate. That compared to 3.9 percent in the first quarter.

The core PCE index closely watched by the Fed advanced at a 2.2 percent rate, the largest increase since the fourth quarter of 2009. It was revised up from 2.1 percent. - Reuters

Lion Industries 4Q net profit falls 62.3% to RM45.01m

KUALA LUMPUR: LION INDUSTRIES CORPORATION [] Bhd (LICB) net profit for the fourth quarter ended June 30, 2011 fell 62.3% to RM45.01 million from RM119.59 million a year earlier, due mainly to higher raw material costs.

It said on Friday, Aug 26 that revenue for the quarter rose 32.85% to RM1.48 billion from RM1.11 billion in 2010.

Earnings per share was 6.28 sen compared to 16.74 sen in 2010, while net assets per share was RM4.54.

LICB proposed a gross dividend of 3 sen per share and single tier dividend of 1 sen per share.

For the financial year ended June 30, LICB's net profit fell 35.78% to RM232.11 million from RM361.47 million, despite a 10.66% increase in revenue to RM4.95 billion from RM4.47 billion.

Reviewing its performance, LICB attributed the increase in its revenue to higher sales of building materials.

However, the group recorded a lower profit from operations of RM95.1 million as compared to RM403.2 million a year ago mainly due to lower sales tonnage of steel products and higher raw material cost, it said.

On its prospects, LICB said the Group's steel division was expected to face increased challenges amid uncertainties brought about by the growing fear of a global slowdown.

'However, the domestic demand for steel products and building materials is expected to grow in line with the implementation of various infrastructure and CONSTRUCTION [] projects which augur well for our steel and building material operations.

'Moving forward, the group expects to record a set of satisfactory results for the next financial year,' it said.

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Petronas: More dependence on gas imports

KUALA LUMPUR:'' Petroliam Nasional Bhd (Petronas) will need to rely more on gas imports in the future to ensure the nation's security of gas supply, but cautions about the overreliance on subsidies to keep the prices at current levels.

Its chief executive officer Datuk Shamsul Azhar Abbas said on Friday, Aug 26 the increased dependence on imported gas would take up a significant portion of it capital expenditure which it had previously budgeted for. It had earlier reported it would invest up to RM300 million as capital expenditure.

Speaking at the national oil corporation's first quarter earnings for the period ended June 30, he said there was an increased pressure on the supply of gas because it had been maintained as a cheap commodity for the country.

'Subsidies for gas were first introduced in 1997 during the Asian Financial Crisis, and developments in the market had since kept the subsidies ongoing. Gas is relatively cheap to coal and other alternatives, and this has exponentially pushed up demand more than it should have gone up,' Shamsul said

Any disruption in supply, however minute, was bound to create a massive impact, because of the strain on the supply of gas, he said.

Shamsul said it was crucial for the government to gradually remove gas subsidies, in order to ease the demand for gas.

'The bottomline is that we will have to face the reality of the situation. Most of the domestic needs for gas will be met by importing gas at market prices, and (simultaneously) subsidies for gas will gradually be withdrawn,' he said.

Proton's 1Q net profit slumps 94%, Lotus weighs

KUALA LUMPUR: PROTON HOLDINGS BHD []'s net profit fell sharply by 94.6% to RM4.55 million in the first quarter ended June 30, 2011 from RM84.68 million a year ago largely due to the higher expenses incurred by Lotus Group International Bhd.

It said on Friday, Aug 26 that revenue fell 2.9% to RM2.23 billion from RM2.29 billion while earning per share were 0.8 sen compared with 15.4 sen.

Proton said its operating expenses were RM2.29 billion, higher than its revenue of RM2.23 billion in the first quarter. A year ago, its operating expenses were RM2.22 billion.

However, it benefited from higher other operating income of RM74.18 million compared with RM33.49 million a year ago. Pre-tax profit was RM12.11 million compared with RM104.65 million.

Inventories as at June 30, 2011 were RM1.284 billion compared with RM1.21 billion at March 31, 2011. Trade and other receivables rose to RM1.42 billion from RM1.32 billion during the three month period.

Proton, in its performance review, said the decline in the profit was largely attributed by higher expenses incurred by Lotus Group in the current quarter, which was in line with the group's efforts in achieving Lotus Group's long term business transformation plans.

The pre-tax profit was RM12 million in 1Q compared with the RM80 million in the fourth quarter ended March 31, 2011.

'In the current quarter, the group experienced a lower sales volume, mainly due to normalisation in the customers' demand for the Inspira. The group also saw a drop in the financing approval rates by local financial institutions in June 2011, as a result of the Hire Purchase Act 1967 amendment implemented in the same month,' it said.

On the outlook, Proton said the group would step up its sales and marketing activities for the current offerings to increase sales volume and to increase income from after-sales related products and services.

Hong Leong Bank 4Q net profit dips 2.09% to RM296.6m

KUALA LUMPUR: HONG LEONG BANK BHD []'s net profit for fourth quarter ended June 30, 2011 slipped 2.09% to RM296.60 million from RM302.94 million a year, due mainly to higher operating expenses and allowance for impaired loans.

Revenue for the quarter jumped 57.7% to RM820.79 million from RM520.25 million in 2010. Earnings per share was 20.42 sen compared to 20.90 sen in 2010, while net assets per share was RM5.13.

HLBank proposed a final gross dividend of 15 sen per share.

For the financial year ended June 30, HLBank's net profit rose 12.5% to RM1.13 billion from RM1.01 billion in 2010, on the back of a 21.9% increase in revenue to RM2.54 billion from RM2.08 billion.

Reviewing its performance, HLBank said the increase in its profit was due to higher net income by RM457.5 million and higher share of profit from Bank of Chengdu of RM67.4 million.

However, it said this was mitigated by higher allowance for impaired loans of RM32.2 million, higher other operating expenses of RM289.2 million and lower write back of impairment losses by RM4.8 million.

On its prospects, HLBank said it was cautiously optimistic on the economic outlook for the remainder of the year.

Arising from the merger with EON, we continue to be on track for the full integration.

The integration brings opportunities for the combined group top reassert our market positioning, expand our business reach, serve our customers and community, achieve greater economies of scale and efficiency, and increase our talent capacity for our domestic and regional aspirations.

'We will leverage our collective strengths for value creation, growth and profitability,' it said.



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FNM KLCI falls 39.17 points week-on-week

KUALA LUMPUR: The FBM KLCI fell 39.17 points week-on-week on Friday, Aug 26 as banks and blue chips fell on heavy selling ahead of the holiday-shortened week ahead.

Analysts said the selling was from foreign funds on concerns about the economy slowing, worsened further by the US and European economies.

As for the recent corporate results, they said the earnings were not that impressive also.

European shares and the dollar fell on Friday, with markets playing down chances of a major shift towards further economic stimulus from US Federal Reserve chairman Ben Bernanke later in the day, according to Reuters.

Bernanke was to speak later in the day at a Fed conference in Jackon Hole, Wyoming.

Also, the Spanish economy grew at a slower pace in the second quarter than the first, fuelling concerns Spain could slip back into recession if the euro zone economy continues to worsen, it said.

On Bursa Malaysia, the FBM KLCI fell 19.93 points to 1,444.81, weighed by losses at banks and blue chips.

Losers thumped gainers by 640 to 168, while 228 counters traded unchanged. Volume was 966.74 million shares valued at RM2.27 billion.

At the regional markets, Hong Kong's Hang Seng Index fell 0.86% to 19,582.88, the Shanghai Composite Index shed 0.12% to 2,612.19 and Singapore's Straits Times Index xxx

Elsewhere, Japan's Nikkei 225 gained 0.29% to 8,797.78, South Korea's Kospi added 0.81% to 1,778.95 and Taiwan's Taiex rose 0.46% to 7,445.10.

Among the banking stocks on Bursa Malaysia, HLFG fell 46 sen to RM11.68, Hong Leong Bank lost 42 sen to RM12.36, CIMB 21 sen to RM7.04 and Maybank down six sen to RM8.67.

BAT fell 56 sen to RM43.92, Tasek 44 sen to RM7.26, Lafarge Malayan Cement and Genting 32 sen to RM6.68 and RM9.46, Bumi Armada and Petronas Chemicals 27 sen each to RM3.53 and RM6.03 and Tradewinds 26 sen to RM8.89.

CIMB was the most actively traded counter with 56 million shares done.

Other actives included Axiata, Petronas Chemicals, MUI, Bumi Armada, MRCB, AirAsia and Maybank

Gainers included Yong Tai, Rapid, Advanced Packaging, Panasonic, Nilai, Sungei Bagan and Axiata.

''

#Flash* Petronas 1Q net profit up 48% to RM21.7b

KUALA LUMPUR : Petroliam Nasional Bhd's net profit increased 48% to RM21.65 billion in the first quarter ended June 30, 2011 from RM14.62 billion a year ago, boosted by the strong crude oil price but slower economic growth was expected to trim its earnings.

The national oil corporation's improved performance was driven by higher prices across its product range with favorable crude oil price pushing up the group's revenue by 24.6% to RM73 billion from RM58.6 billion a year ago.

Petronas chief executive officer Datuk Shamsul Azhar Abbas said on Friday, Aug 26 the improved performance in the first quarter was however not sustainable as the macro economic conditions in the second half gets worsen due to the uncertainties in the developed countries.

"Based on the July numbers, the economy is heading into a slowdown in the second quarter and this is expected to continue into next year. We had a good run during the first quarter but I think the party is over now," he said.

In the first quarter, average benchmark price of crude oil was in the range of US$105 to US$110 per barrel, whereas it has since dropped to around US$80 to US$85 per barrel now due to the slower demand.

Petronas had in March 2011 announced that it is changing its financial year end from March 31 to Dec 31, reducing it to only nine months.

Ireka in the black, RM7.5m net profit

KUALA LUMPUR: IREKA CORPORATION BHD [] was in the black in the first quarter ended June 30, 2011, with earnings of RM7.45 million compared with a net loss of RM3.26 million a year, lifted by contribution from its associate, Aseana PROPERTIES [] Ltd.

It said on Friday, Aug 26 that revenue dipped 2.6% to RM99.03 million from RM101.71 million a year ago due to lower volume of CONSTRUCTION [] work completed during the period.'' Earnings per share were 6.54 sen compared with loss per share of 2.87 sen.

Ireka said the better performance in the just ended quarter was also boosted by a share of profit in Aseana Properties, a 23.02% associate which reported profit of RM7 million compared a a loss of RM6.53 million a year ago.

There was also a mark-to-market loss for share investment in Kinh Bac City Development Shareholding Corporation of RM1.64 million compared with only RM595,000 a year ago. The results were also affected by lower construction margins during this period.

On the prospects, it said based on existing works on hand, Ireka expected its turnover to be maintained in the current financial year.

'As at end July 2011, the group's order book stood at about RM1.22 billion, of which RM414 million remained outstanding. Over the 12 months, the group tendered for jobs totaling over RM1 billion ahd had successfully secured three projects with total contract sum of about RM400 million,' it said.

#Update* Foreign selling weighs on KLCI

KUALA LUMPUR: Malaysia's stock market continued to be battered by fund selling of bank stocks on Friday, Aug 26 but more worrying was the selling was extending to other fundamentally strong and smaller capitalised stocks also.

Analysts said the selling was from foreign funds on concerns about the economy slowing, worsened further by the US and European economies. As for the recent corporate results, they said the earnings were not that impressive also.

At 3.21pm, the FBM KLCI was down 22.22 points to 1,442.52. Turnover was 602.32 million shares valued at RM1.39 billion. Losers battered gainers 661 to 99.

It was HL Bank and HLFG's turn to come under selling, down 42 sen each to RM12.36 and RM11.72. CIMB was the most active, falling 23 sen to RM7.02.

Other big capitalised stocks fell, with GENTING BHD [] down 33 sen to RM9.45 and KLK 24 sen to RM21.24 while Bumi Armada shed 26 sen to RM3.54 after its disappointing results.

Petronas Chemicals lost 22 sen to RM6.08, Airasia 16 sen to RM3.341 and MRCB nine sen to RM1.96

Kulim 2Q net profit surges nine-fold to RM146.29m

KUALA LUMPUR: KULIM (M) BHD [] net profit for the second quarter ended June 30, 2011 surged nine-fold to RM146.29 million from RM14.66 million a year earlier, driven by mainly by higher revenue and profits from its PLANTATION [] division.

In it said on Friday, Aug 26 that revenue for the period rose 32.4% to RM1.80 billion from RM1.36 billion, with higher contribution from all segments.

Earnings per share was 11.70 sen compared to 4.69 sen, while net assets per share was RM3.03.

For the six months ended June 30, Kulim's net profit surged to RM273.39 million from RM76.55 million in 2010, on the back of a 33.3% jump in revenue to RM3.46 billion from RM2.59 billion.

Reviewing its performance, Kulim said the oil palm sector recorded higher revenue and profits for the cumulative quarters due to better palm products prices and higher FFB production.

The higher revenue at the foods and restaurant group was due mainly to the better contributions from its KFC operations in Malaysia and its Singapore's Pizza Hut operations, it said.

On its prospects, Kulim said that although palm prices had fallen by almost 8%, the remaining quarters, are nonetheless, expected to perform well due to the forecasted improved FFB production during the period.

On its Papua New Guinea and Solomon Island operations, Kulim said NBPOL appeared to be increasing in production and higher prices of palm products indicate results for the remaining quarters of the current financial year to be better than the current quarter.

It said the foods and restaurants division was taking several initiatives to develop and introduce new products with value propositions in mind to drive transactions at the group's operating network.

Kulim said it would continue to implement its plan of increasing revenue and profitability by enhancing customer experience, increasing the restaurants network, expanding business activities, developing better cost efficiencies and improving productivity at all its restaurants, manufacturing and production facilities.

The shipping business had registered much improvement as all the vessels ordered have been progressively delivered to the oil majors on term charter which are currently operating smoothly, it said.

'Based on the above generally positive outlook, the board is confident that 2011 will be another good year for the group,' said Kulim.

''

Zeti among top 6 central bankers in the world

KUALA LUMPUR: Bank Negara Governor Tan Sri Dr Zeti Akhtar Aziz has been named as one of the six World's Best Central Bankers over the past year by Global Finance magazine in its October issue.

She also maintained her 'A' grade rating.

The other five central bankers were Glenn Stevens from Australia, Stanley Fischer from Israel, Riad Salameh from Lebanon, Amando Tetangco Jr from the Philippines and Fai-Nan Perng of Taiwan.

In a statement Aug 25, Global Finance said the 'Central Banker Report Card' feature, published annually by Global Finance since 1994, grades Central Bank Governors of 36 key countries (and the ECB) on an 'A' to 'F' scale for success in areas such as inflation control, economic growth goals, currency stability and interest rate management. ('A' represents an excellent performance down through 'F' for outright failure.)

Global Finance publisher Joseph Giarraputo said in this year's edition, during one of the toughest years on record, the World's Central Bankers were tested as never before.

'Every year, we assess the determination of Central Bankers to stand up to political interference, and their efforts at influencing their governments on such issues as spending and economic openness to foreign investment and financial services,' he said.

US Federal Reserve Chairman Ben S. Bernanke received a 'C' in Global Finance magazine's annual grading of the world's central bankers.

Bernanke's grade was unchanged from last year, while outgoing European Central Bank President Jean-Claude Trichet was given a 'B-' after last year's 'A.'

Bank of Japan Governor Masaaki Shirakawa also received a 'C' while Mark Carney of Canada and the U.K.'s Mervyn King were both given a 'B.'

''

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Petronas Chemicals posts net profit RM737m

KUALA LUMPUR: Petronas Chemicals Group Bhd (PCB) posted net profit RM737 million on the back revenue RM3.35 billion for the period ended June 30, 2011, due mainly to strong prices seen across most petrochemical products, partially offset by a stronger ringgit versus the US Dollar.

It said on Friday, Aug 26 that earnings per share was nine sen and net assets per share was RM2.54.

Reviewing its performance, PCG said that during the quarter, there was methane gas supply limitation for the Fertiliser and Methanol segment, which affected the production of fertiliser, methanol and ammonia.

The gas supply constraint, however, did not affect the availability of ethane and propane for Olefins and Derivatives segment, which continued to be the key contributor to the group's results, it said.

In addition, there was significant level of maintenance activities, which combined with the gas supply limitations, led to lower plant utilisation and reduced production volume for the quarter, it said.

'Despite these challenges, the Group's operating profit increased by RM114 million (13%) on the back of higher product prices and lower feedstock costs.

'The Group continues to see higher amortisation expenses in the current quarter, arising from reclassification of goodwill from acquisition of subsidiaries to other intangible assets in September 2010 and March 2011,' said PCG.

Meanwhile, share of profits from associates and jointly controlled entities remained a sizeable contributor to the Group's results, albeit decreasing slightly by RM15 million, it said.

PCG said that overall, profit for the period increased by 12% or RM85 million to RM814 million.

"The group's EBITDA of RM1.24 billion for the current quarter, therefore, represented 14% increase from RM1.09 billion recorded in the corresponding quarter,' it said.

Commenting on its prospects, PC G said that moving forward, the results of its operations were expected to be primarily influenced by fluctuations in international petrochemical products prices, global economic conditions and utilisation rate of its production facilities.

'The board expects the plant maintenance activities to be at a reduced level for the remaining quarters in the current financial period.

'Consistent with previous periods, the Olefins and Derivatives segment will continue to be the key contributor to the Group's results. Subject to sufficient availability of methane gas supply, we expect that the results of our operations for the financial period ending Dec 31, 2011 to be satisfactory,' it said.

PCG had on March 2, 2011 announced the change of financial year end from March 31 to Dec 31 beginning from April 2011. As a result, there is no equivalent comparative quarters.

''

Overseas segment to be PPB's growth driver, says MD

KUALA LUMPUR: PPB GROUP BHD []'s overseas segment will be the main driver of the group's future growth, said its managing director Tan Gee Sooi.

Speaking at a media briefing on Friday, Aug 26, Tan said the group was currently expanding its flour mills in Vietnam and Indonesia.

PPB's revenue increased by 16% to RM1.26 billion owing mainly to its higher sales of flour in Indonesia and Vietnam.

The group is currently looking at increasing the production capacity of it flour mills in Indonesia and Vietnam by 100% with a total investment of RM100 million from its annual capital expenditure of RM267 million.

"It will be fairly hard to estimate the revenue increase for such an expansion. It will take time to build up and it depends on good demand and consumption" said the group's CFO Leong Choy Ying.

KLCI falls 1.24% at mid-day, OSK Research hints earnings growth cut

KUALA LUMPUR: ''The FBN KLCI fell 1.24% at the mid-day break on Friday, Aug 26, in line with the tepid sentiment at most regional markets as OSK Research cautioned that its 2012 KLCI earnings growth forecast could be cut.

The FBM KLCI fell 18.20 points to 1,446.54 at 12.30pm, weighed by losses at banking and key blue chip stocks.

Losers thumped gainers by 586 to 89 while 205 counters traded unchanged. Volume was 444.42 million share valued at RM995.30 million.

The ringgit weakened 0.13% to 2.9905 versus the US dollar; crude palm oil futures for the third month delivery fell RM29 to RM2,965, crude oil slipped 15 cents per barrel to US$85.15 while gold gained US$4.10 an ounce to US$1,778.25.

OSK Research director Chris Eng in his preliminary second quarter 2011 roundup strategy report said he expects his 2012 KLCI earnings growth forecast of 12.8% to be cut in the coming days and maintain OSK Research's Neutral call on the Malaysian market.

He said with investors' attention fixed over the past 3 weeks on the volatile movements in global equity markets, the research house was swinging its focus back onto fundamentals by having an early review of Malaysian corporate results announced thus far.

'What we discover is not pretty with earnings continuing to slide and the Big Caps joining the Small Caps in both disappointments and downgrades.

'The Upgrade to Downgrade ratio has fallen further to 0.45 times with previous stalwarts in the Banking sector also experiencing earnings downgrades. As such, the fall in the KLCI that was earlier attributed purely to sentiment now appears to be gaining a fundamental basis,' he said.

Eng said investors were advised to continue focusing on defensive stocks.

On Bursa Malaysia, CIMB and RHB Capital fell 21 sen each to RM7.04 and RM8.11, Hong Leong Bank 32 sen to RM12.46, HLFG 26 sen to RM11.88, BAT 42 sen to RM44.06, KLK36 sen to RM21.12, Nestle and Bumi Armada 24 sen each to RM47.90 and RM3.56, while Batu Kawan lost 22 sen to RM15.48.

CIMB was the most actively traded counter with 35.1 million shares done. Other actives included Axiata, MUI, Bumi Armada, MRCB, AirAsia and Petronas Chemicals.

Gainers included Panasonic, Nilai, Kamdar, Sungei Bagan, MISC and CBIP.

At the regional markets, Japan's Nikkei 225 was flat at 8,772.28, Hong Kong's Hang Seng Index fell 0.21% to 19,710.07, the Shanghai Composite Index lost 0.79% to 2,594.72 and Singapore's Straits Times Index fell 0.79% to 2,743.95.

Meanwhile, Taiwan's Taiex added 0.46% to 7,445.05 and South Korea's Kospi gained 0.12% to 1,766.72.

#Flash* Sime may be buying 30% stake in E&O

KUALA LUMPUR: Conglomerate SIME DARBY BHD [], which is bolstering its property development division, may acquire a 30% stake in developer Eastern & Oriental Bhd (E&O), two sources familiar with the deal said.

The stake include that held by Singapore-listed G K Goh Ltd, whose shares has been suspended pending an announcement on the deal which is expected as soon as this evening.

The shares of E&O were suspended before trading started today.

In a filing to Bursa, the company said the suspension request was pending an announcement.

KLCI down at mid-morning, CIMB weighs

KUALA LUMPUR: The FBM KLCI extended its losses on Friday, Aug 26 in line with the tepid sentiment at key regional markets following the weaker overnight close at Wall Street, as well the holiday-shortened trading week ahead.

Yesterday, a sharp sell-off in the DAX impacted US stocks and risk assets broadly ahead of the Kansas City Fed's Jackson Hole symposium.

The DAX fell 4% over a 15 minute period during the European afternoon and the exact cause of the decline is still unknown.

Fed chief Ben Bernanke is due to address central bankers at an annual symposium in Jackson Hole, Wyoming, on Friday. His speech last year laid the groundwork for the Fed's US$600 billion bond-buying program, to revive the US economy.

The FBM KLCI fell 12.10 points to 1,452.64 at 10am, weighed by losses at key blue chips including CIMB, Axiata, RHB Capital and Genting.

Losers led gainers by 312 to 85 while 154 counters traded unchanged. Volume was 130.63 million share valued at RM294.27 million.

At the regional markets, Japan's Nikkei 225 shed 0.07% to 8,766.54, Hong Kong's Hang Seng Index fell 0.24% to 19,705.68, the Shanghai Composite Index lost 0.38% to 2,605.25 and Singapore's Straits Times Index fell 0.81% to 2,743.33.

Meanwhile, Taiwan's Taiex added 0.38% to 7,439.36 and South Korea's Kospi gained 0.12% to 1,766.63.

Strategists at the Royal Bank of Scotland said they did not think that there was much that Bernanke could say or do, especially after the latest FOMC statement and the mid-2013 anchor for "lower for longer."

'The inflation backdrop is different now and despite the Fed's best efforts, one measure of the money multiplier shows that all the Fed's liquidity is not really spreading through the system as they had hoped,' they said in a note Aug 26.

BIMB Securities Research in a note Aug 26 said that after three days of gains on Wall Street, investors were spooked by rumours that the 'trigger happy' rating agencies may look to downgrade some European countries over the debt situation that remains very much prevalent and use it as an excuse to take profit pushing the Dow Jones Index down 171 points.

Volatility should take centre stage today for regional bourses as investors may look to sell with an eye on Bernanke's address today, it said.

'Despite the stronger regional performance yesterday, the FBM KLCI went south attributed mainly to the selling on CIMB which on its own had contributed a six point decline to the benchmark index.

'We believe investors would remain sidelined for today ahead of a lengthy break next week and expect some selling to persist. Next support is seen at the 1,460 mark,' it said.

On Bursa Malaysia, CIMB was the most actively traded counter with 17.77 million shares done. The stock fell 20 sen to RM7.05.

Other actives included Axiata, Eden, Bumi Armada, Trinity, AirAsia, MUI and Karambunai.

Among the losers, RHB Capital fell 21 sen to RM8.11, Allianz 19 sen to RM4.56, QSR and Bumi Armada 15 sen each to RM5.71 and RM3.65, Batu Kawan and HLFG 14 sen each to RM15.56 and RM12, while Genting lost 13 sen to RM9.65.

Gainers included DiGi, MISC, Kretam, Panasonic, Nilai and United Malacca.

''

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Maybank IB Research downgrades Genting to Hold

KUALA LUMPUR: Maybank Investment Bank Bhd Research has downgraded GENTING BHD [] to Hold from Buy previously, and cut its target price for the stock to RM10.20 from RM12.76, and said Genting's 1H11 results were largely within expectations.

It said in a note Aug 26 that Genting's 2Q11 core net profit of RM634 million (-19% y-o-y, - 26% q-o-q) brought 1H11 core net profit to RM1.5 billion (+21% y-o-y) which was within expectation at 47% of its full year estimate.

The research house said that excluding Resorts World New York (RWNY) development revenue, 1H11 revenue of RM8.7 billion (+21% y-o-y) was also within expectations at 48% of its 2011 estimate.

The interim dividend per share of 3.5 sen less tax (1H10: 3.3 sen less tax) was also within expectations, it said.

Maybank IB Research said weaker earnings year-on-year were due to poor VIP win rate at 52% owned Resorts World Sentosa (RWS) and 49% owned Genting UK (GENUK).

'We trim our earnings estimates by 6%-9% on lower share of Singaporean VIP volume for RWS.

'Volatile equity markets do not favour this high beta stock. Its share price will also be affected by sentiment at Genting Singapore,' it said.

AmResearch rules out a double-dip in the Malaysian economy

AmResearch has ruled out a double-dip in the Malaysian economy, as robust levels of domestic demand along with ample liquidity and government's economic transformation programme (ETP) will provide support at the tail-end of the year.

Its senior economist Manokaran Mottain in a note Friday, aug 26 said concerns about a potential double dip recession in the global economy had resurfaced, given the realisation that the heavily-indebted developed western countries can no longer spend their way out of any potential downturn.

Emerging economies were threatened by falling exports due to stagnant growth or recession in the OECD economies, as well as persistently high inflationary pressures, he said.

'The US and Eurozone economies have stagnated. Although the risk of a double dip in individual economies, especially for the US and EU, has increased tremendously in recent weeks, we believe that the global economic recovery would be supported by sustained growth in the emerging economies such as China and India,' he said.

Manokaran said these economies should have no issue in further extending fiscal and monetary support to their respective economies, if the need arises.

'While slower rates of growth were seen in these countries recently due to intensive monetary tightening earlier in the year, improving consumer sentiments on the back of falling commodity prices will likely kick start consumer spending across the region, fostering robust levels of growth across all sectors,' he said.

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UEM Land active, up on firm earnings

KUALA LUMPUR: UEM LAND HOLDINGS BHD [] shares were actively traded on Friday, Aug 26 after its net profit for the second quarter ended June 30, 2011 more than doubled to RM88.93 million from RM40.35 million a year earlier due mainly to an increase in its revenue.

At 9.18am, UEM Land added two sen to RM2.12 with 792,000 shares done.

The company said on Thursday, Aug 25 that its revenue for the quarter surged to RM509.40 million from RM88 million in 2010.

Earnings per share was 2.17 sen compared to 1.23 in 2010, while net assets per share was RM1.03.

For the six months ended June 30, UEM Land's net profit surged to RM106.54 million from RM43.49 million in 2010, on the back of a more than five-fold increase in revenue to RM697.09 million.

Genting shares decline on cautious outlook, lower 2Q earnings

KUALA LUMPUR: GENTING BHD [] shares declined in early trade on Friday, Aug 26 after the company said was cautious on the outlook of the leisure and hospitality industry as the global economy was showing signs of increasing uncertainties.

At 9.25am, Genting fell 12 sen to RM9.66 with 295,000 shares traded.

Its net profit for the second quarter ended June 30, 2011 fell 8.92% to RM673.22 million from RM739.17 million a year earlier, while revenue for the quarter rose 9.3% to RM4.46 billion from RM4.09 billion in 2010.

Genting said on Thursday, Aug 25 that its earnings per share was 18.17 sen compared to 20 sen in 2010, while net asset per share was RM4.53.

On its prospects, Genting said the power division might be affected by higher coal prices which would however be mitigated by an increase in tariff rate for the Meizhou Wan power plant which has been agreed with the provincial government and expected higher summer generation hours.

Meanwhile, it said the performance of Genting PLANTATION []s Bhd was expected to be better than that of the previous financial year

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Bumi Armada sinks on lower 2Q earnings

KUALA LUMPUR: Bumi Armada Bhd's shares retreated on Friday, Aug 26 after its earnings fell 18% to RM60.26 million in the second quarter ended June 30, 2011 from RM73.65 million a year ago due to higher finance costs and taxation.

At 9.45am. Bumi Armada lost 15 sen to RM3.65 with 3.99 million shares done.

It said on Thursday, Aug 25 that revenue rose 40.9% to RM392.96 million from RM278.85 million.

Earnings per share were 2.64 sen compared with 3.69 sen.

For the first half, its net profit was marginally higher by 1.4% to RM142.33 million from RM140.30 million a year ago. Its revenue increased by 42% to RM769.12 million from RM541.31 million.

CIMB Research maintains Trading Buy on Impaspro Corp

KUALA LUMPUR: CIMB Equities Research said agrochemical and pesticide manufacturer, Imaspro Corp's FY6/11 net profit was in line at just 1% above its forecast.

It said on Friday, Aug 26 the stronger sales mitigated the weaker margins and strengthening of the ringgit.

Consistent with the previous year, Imaspro did not declare a final dividend.

'We fine-tune our FY12-13 EPS numbers by -1% to +0.3% as we update the balance sheet items. Due to the minimal earnings change, our target price remains at RM1.13, still pegged to 8.7 times CY12 P/E, which is a 40% discount to our target market P/E of 14.5 times,' it said.

CIMB Research said it was still looking at healthy earnings growth of 8-18% for FY12-14. The stock remains a BUY.

'Potential re-rating catalysts are i) new product launches, 2) margin recovery, and 3) rising cash pile which could mean higher dividends or M&As,' it said.

CIMB Research has Technical sell on KLK

KUALA LUMPUR: CIMB Equities Research has a Technical Sell on Kuala Lumpur Kepong at RM21.48 at which it is trading at a FY12 price-to-earnings of 16.4 times and price-to-book value of 3.4 times.

It said on Friday, Aug 26 that prices appear to be forming a bearish wedge pattern here where there is one more short push to complete this pattern. Prices would also have a tough time taking out the moving averages.

'Hence, in the near term, gains are likely to be capped at RM21.80 to RM22.20. Near term indicators are still positive, which supports the final upward push,' it said.

CIMB Research said traders would likely be better off taking profits on strength. Once this bearish wedge pattern ends, its expect prices to tumble below the RM19.74 levels. And in breaking this key support, the stock would have a RM16.00 target for the medium term.

CIMB Research has Technical sell on QSR Brands

KUALA LUMPUR: CIMB Equities Research has a Technical Sell on QSR Brands at RM5.86 at which it is trading at a FY12 price-to-earnings of 14.3 times and price-to-book value of 1.9 times.

It said on Friday, Aug 26 that the fall from RM6.58 appears impulsive and the current move is likely a short term corrective rebound. Prices have rebounded to its 50%FR levels and reversed but we would not be surprised if prices climbed again to test its 62%FR at RM6.21.

CIMB Research said either way, a break below the RM5.62 levels would signal that the next downleg is underway, targeting RM4.83-RM4.90. The following support is at RM4.55.

'The stock is a sell as both its indicators are looking weak at the moment. We would review our call only if prices take out the RM6.58 high,' it said.

CIMB Research has Technical sell on KPJ Healthcare

KUALA LUMPUR: CIMB Equities Research has a Technical Sell on KPJ Healthcare at RM4.40 at which it is trading at a price-to-book value of 3.1 times.

It said on Friday, Aug 26 that KPJ broke below its key support trend line in early August before the current rebound took prices back up to retest the underside of this line. Prices appear to have reversed after failing to break above this line.

CIMB Research said the stock looks weak, technically. Both its momentum indiactors are in sell mode and with its RSI not yet oversold, there is stiil room on the downside.

'It is possible that prices are going to fall back towards the RM4.10 lows again in the coming days if not weeks. The 200-day SMA would also be tested.

'Breaking below both of this support would mean that prices could be heading towards RM3.70-3.08 next. Anything above RM4.61 would trigger our stop,' it said.

Blue chips drag KLCI lower in early trade

KUALA LUMPUR: Key blue chips fell in early trade on Friday, Aug 26 in line with most key regional markets, with many investors opting for the sidelines ahead of a key speech by Federal Reserve Chairman Ben Bernanke on the US economy.

At 9.05am, the FBM KLCI lost 11.62 points to 1,453.12.

CIMB was the most actively traded counter with 2.25 million shares done. The stock extended its losses by 20 sen to RM7.05.

Other early decliners included HLFG, Hong Leong Bank, CIMB, QSR, MISC, Genting and IOI Corp.

GLOBAL MARKETS-Stocks drop 1.5 pct, dollar gains before Bernanke

NEW YORK: World stocks dropped and the U.S. dollar rose against the yen on Thursday, Aug 25 as investors lowered their expectations that the Federal Reserve would signal a dramatic rescue for the economy this week.

Weakness in stocks, which partly reflected jitters over a sharp drop in German shares, helped boost safe-haven gold.

Fed Chairman Ben Bernanke is due to address central bankers at an annual symposium in Jackson Hole, Wyoming, on Friday. His speech last year laid the groundwork for the Fed's $600 billion bond-buying program to revive the economy under the rubric "QE2" for the Fed's second round of stimulus, or quantitative easing.

While investors have speculated Bernanke could signal a new monetary offensive in his talk, many analysts say he could well disappoint those looking for major measures, such as a QE3.

"Over the last couple of days, we have gone from pure excitement about QE3 to being far more muted. I suspect there has been some positioning for a slightly more mundane speech coming from Bernanke," said Camilla Sutton, senior currency strategist at Scotia Capital in Toronto.

Worries about the faltering U.S. economic recovery as well as the euro zone debt crisis have plagued investors for weeks.

Stocks posted gains earlier this week partly on expectation the soft U.S. economy would trigger another round of monetary stimulus from the Fed.

Under quantitative easing, the Fed effectively prints money to buy bonds, with the aim of depressing U.S. Treasury yields even further and encouraging investors to seek higher returns elsewhere.

An increase of money supply would also erode the value of the dollar relative to other currencies. On Thursday, the dollar rose to 77.48 yen, up 0.7 percent.

The MSCI world equity index fell 1.1 percent. The benchmark, however, is on track to post its first weekly gain in five weeks, having hit an 11-month low earlier this month.

Talk of a broad short-selling ban in Germany caused a slump in European indexes, with the DAX leading the way and falling to a low of 5,451 points before paring losses and ending down 1.7 percent.

Comments from the German finance ministry and a regulator appeared to quash initial fears, although it was not enough to restore the market's earlier gains and the broader FTSEurofirst 300 ended the day down 1.25 percent.

In the United States, the Dow Jones industrial average fell 170.89 points, or 1.51 percent, to end at 11,149.82. The Standard & Poor's 500 Index lost 18.33 points, or 1.56 percent, to end at 1,159.27. The Nasdaq Composite Index dropped 48.06 points, or 1.95 percent, to end at 2,419.63.

"They're selling ahead of Bernanke and being fairly cautious in their positioning," said Len Blum, managing partner of Westwood Capital LLC in New York.

Among U.S. stocks, Apple slipped 0.7 percent to $373.72 after the resignation of its founder and chief executive, Steve Jobs.

Bank shares rose, however, after Warren Buffett's Berkshire Hathaway said it would invest $5 billion in Bank of America. Shares of the Dow component jumped 9.4 percent to $7.65 but are still down for the month.

GOLD REVERSES LOSS, BONDS AND OIL UP

Worries about a global recession have sent investors scrambling for gold and other safe-haven assets in recent weeks.

Gold traded higher on Thursday, a day after registering its biggest percentage one-day drop since December 2008. Spot gold was last up 0.5 percent at $1,759.99 an ounce.

U.S. Treasury prices also advanced. Benchmark 10-year Treasury notes finished 19/32 higher in price to yield 2.23 percent, down 7 basis points from late on Wednesday.

Data showing higher-than-expected claims for U.S. jobless benefits helped support bond prices and was the latest report to suggest the job market is still struggling to gain momentum.

Thomas Hoenig, president of the Kansas City Federal Reserve Bank, said in an interview with Reuters Insider television that he does not see another U.S. recession looming.

In the oil market, U.S. crude futures edged up in volatile trading as strong gasoline and heating oil futures supported prices on the threat from Hurricane Irene.

The storm was forecast to affect the U.S. Northeast -- and possibly the New York City area -- on Saturday or Sunday.

On the New York Mercantile Exchange, October crude rose 14 cents, or 0.16 percent, to settle at $85.30 a barrel. Brent crude settled at $110.62, up 47 cents. - Reuters

ASIA-Shares to struggle ahead of Bernanke speech

WELLINGTON: Asian stocks are likely to weaken as investors turn cautious ahead of a speech by the head of the U.S. Federal Reserve, which they hope may give some signals on future measures to stimulate the world's biggest economy.

Investor sentiment has cooled of late amid fading expectations that Fed chairman Ben Bernanke will deliver anything more than a statement of the Fed's readiness to act if a fall back into recession should threaten.

Wall Street's main indexes closed between 1.5 percent and 2 percent lower, snapping three sessions of gains, with sentiment also soured by a fall in German stocks and data showing a still weak U.S. jobs market.

Asian stocks listed on Wall Street fell 1.46 percent, world stocks, as measured by the MSCI world equity index , fell 1.1 percent, and emerging markets stocks were down 0.5 percent.

British shares fell 1.4 percent while European shares dipped 1.25 percent, after talk of a broad-based ban on short selling in Germany. Officials later looked to quash initial fears but not enough to restore the market.

Gold was back in favour, rising 0.5 percent, a day after it posted its biggest one-day fall since December 2008.

Japanese markets may follow Wall St's lead and retreat and position ahead of Bernanke. Nikkei futures traded in Chicago 35 points below the last closing level in Osaka.

Australian stocks may open lower with share price index futures at a 43.8 point premium to the close of the underlying S&P/ASX 200 index. ' Reuters

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Nikkei edges lower on profit-taking; Bernanke awaited

TOKYO: The Nikkei benchmark edged lower on Friday on profit-taking after a 1.5 percent rise the previous day, while investors remained cautious ahead of a speech from U.S. Federal Reserve Chairman Ben Bernanke.

The benchmark Nikkei was down 0.3 percent at 8,744.96, while the broader Topix index shed 0.2 percent to 750.13. ' Reuters

Tense market falls ahead of Bernanke speech

NEW YORK: U.S. stocks fell on Thursday as investors raised cash ahead of a critical speech from Fed Chairman Ben Bernanke, hoping he will give them a clearer picture of the Fed's plans for the struggling economy.

Several negatives contributed to the market's weakness after three days of gains. Jitters over a sharp drop in German stocks and a report showing continued U.S. job market weakness helped fuel the selling.

Stocks rose earlier this week, partly on expectation the soft U.S. economy could trigger another round of monetary stimulus from the Federal Reserve, much like the one suggested by Bernanke at the same conference in Jackson Hole, Wyoming, a year ago.

"There is an assumption there is not going to be an announcement on monetary policy, but the market set up this week like that was the case," said Art Hogan, managing director of Lazard Capital Markets in New York.

"There seems to be a bit of a dichotomy from what people are saying to what they are doing."

Bernanke, who is scheduled to speak on Friday at 10 a.m. EDT, is most likely to outline gradualist measures, which would disappoint those looking for dramatic action, such as a fresh round of asset purchases.

Stocks opened higher after Bank of America (BAC.N) said Warren Buffett's Berkshire Hathaway (BRKa.N)(BRKb.N) would be taking a $5 billion stake in the bank, whose shares had fallen to two-year lows earlier this week.

"We had some upbeat emotion at the open with Warren Buffett's investment in Bank of America but that fizzled very quickly when we looked across the pond and saw what was going on with German markets," said Hogan.

The S&P 500 is still up 3.2 percent so far this week, which could be the first positive one for the benchmark index in the past five.

The Dow Jones industrial average .DJI dropped 170.89 points, or 1.51 percent, to 11,149.82. The Standard & Poor's 500 Index .SPX fell 18.33 points, or 1.56 percent, to 1,159.27. The Nasdaq Composite Index .IXIC lost 48.06 points, or 1.95 percent, to 2,419.63.

Volume has decreased from the frenzied first three weeks of August. Major averages have stabilized, with 1,120 on the S&P 500 now viewed as a key support level, but it remains to be seen whether stocks can gather enough steam for an extended rally.

"I think a lot of what's been happening in the market is positioning or repositioning for different events," said Doreen Mogavero, CEO of Mogavero, Lee & Co in New York. "I'm not sure how much of it is real investing."

Bank of America gained 9.4 percent to $7.65 in trading of more than 855 million shares, or almost 10 percent of total composite volume on the day.

Citigroup (C.N) gained 4.9 percent to $29.03, but Buffett's investment did not entice buying across the banking sector, and the KBW bank index .BKX shed 0.2 percent.

The S&P financials index .GSPF, which had been the only S&P sector in positive territory earlier in the session, declined 0.46 percent. The index had earlier climbed as much as 4.7 percent.

Apple Inc (AAPL.O) fell 0.65 percent to $373.72 on the first trading day after news that co-founder Steve Jobs resigned as chief executive.

About 8.9 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, above the year-to-date average of 7.9 billion but below the 11.2 billion average so far in August.

Declining stocks outnumbered advancing ones on the NYSE by a ratio of about 16 to 5, while on the Nasdaq, more than four stocks fell for every one that rose.

The European benchmark FTSEurofirst 300 index .FTEU3 fell 1.3 percent and Germany's DAX .GDAXI dropped as much as 5 percent before closing down 1.7 percent on talk Germany could enact a short-selling ban following the example of other European nations. A German government spokesman said there were no plans for a general short-selling ban. - Reuters

Analysis: Fed would get little bang from balance sheet tweak

WASHINGTON: Facing pressure to keep money printing in check, U.S. central bankers are mulling a modest approach to stimulus that would give the struggling economy only a tiny boost -- if it helps at all, Reuters reported on Thursday, Aug 25.

After two rounds of bond purchases that have pumped $2.3 trillion into the banking system, the Federal Reserve could buy long-term Treasury debt while selling short-term securities it already holds.

The idea, outlined by Federal Reserve Chairman Ben Bernanke in July, would be to lower long-term interest rates without increasing the money supply. That in theory could spur home purchases by lowering benchmark rates for mortgages. It could also make it cheaper for companies to borrow so they can buy more equipment.

Such a plan could also weaken the dollar and increase stock prices, which might boost exports and make people feel more positive about the economy.

But many analysts doubt growth would improve much unless the Fed injects a lot more money into the economy.

"I don't think the impact on the real economy is going to be meaningful" without more aggressive Fed action, said Troy Davig, a former Fed economist now at Barclays Capital in New York.

The Fed has already slashed overnight interest rates to near zero. Earlier this month, it said it thought it would keep rates low for at least the next two years.

Of course, it could still summon more dollars and inject them into the system, but higher inflation and political pressure create an imposing hurdle for such bold action.

That leaves relatively underwhelming options.

Davig crunched numbers for the Fed's last stimulus plan to pump $600 billion into the economy by purchasing government debt -- a program dubbed "QE2" -- and estimated it would add about a half percentage point to growth this year.

Bernanke is likely to outline his options when he takes the podium at a conference in Jackson Hole, Wyoming, on Friday.

Yet he cannot work magic.

Even the most aggressive campaign to lower rates without printing money could add just one- or two-tenths of a percentage point to next year's growth rate, Davig said.

Thomas Lam, an economist with OSK-DMG in Singapore, arrived at a similar conclusion, albeit considering a less-aggressive Fed strategy. Under that scenario, the Fed would reinvest money from maturing short-term bonds it holds in long-term assets.

Lam sees such a program adding between one- and three-tenths of a percentage point to growth over a year, and perhaps more if markets respond well to the measure. For example, by bringing down long-term Treasury rates, yield-hungry investors could pile into riskier assets like corporate bonds, making it cheaper for companies to borrow.

PUSHING ON A STRING

The Fed would likely launch some kind of bond-trading plan despite concerns it might not yield big results, analysts say. Every bit of growth helps.

Yet some are doubtful the Fed can do much at all by pushing interest rates lower.

Despite all the money given to banks, lending standards have tightened since the financial crisis.

Commercial real estate developer Andy Farbman could not get a loan recently to buy an office building in downtown Chicago worth just under $10 million.

"It wasn't the cost of the capital. The capital didn't exist," said Farbman, president and chief executive of Southfield, Michigan-based NAI Farbman.

Because the loan wasn't there, Farbman paid cash, which meant less investment capital for other ventures.

Other companies aren't even interested in borrowing money because the weak economy is keeping consumer demand low. Similarly, the housing market keeps on weakening despite historically low interest rates.

In the parlance of economists, using monetary policy to boost growth is like trying to push on a string.

"What is a 2 percent 10-year yield going to do that a 2.5 percent 10-year yield didn't do?" said Jacob Oubina, an economist as RBC Capital Markets in New York, referring to the level of return on a 10-year Treasury note.

Oubina thinks QE2 was a net drag on the economy because, in his view, it pushed commodity prices higher. That might have led consumers to spend more on imported goods like fuel, dragging on gross domestic product.

Others are more optimistic. Former Fed board Governor Larry Meyer said a really aggressive bond trade could have a bigger impact than QE2, but such a trade was unlikely because the Fed would be more vulnerable to losses on its investments. Still, a more plausible trade could give the economy a modest boost, he said in a report for Macroeconomic Advisers.

Also seeing benefits from the trade, economists at Goldman Sachs think an aggressive campaign by the Fed to buy long-term bonds while selling short-term assets could boost real GDP growth by up to three-tenths of a percentage point in the year after any announcement.

That would be at least a bit of good news for U.S. companies.

"I'm not sure that we've seen any particular impact from QE1 or 2," said Hormel Foods Corp CEO Jeff Ettinger.

"(But) if consumers can get more comfortable with their financial position, that's good for business, period." - Reuters

Warren Buffett to invest $5 bln in Bank of America

NEW YORK: Warren Buffett's Berkshire Hathaway will invest $5 billion in Bank of America, stepping in to shore up the company in the same way he helped prop up Goldman Sachs during the financial crisis.

Bank of America shares rose 20 percent in pre-market trading on the news.

Bank of America will sell Berkshire 50,000 shares of cumulative perpetual preferred stock with a 6 percent annual dividend, it said in a statement on Thursday. Bank of America can buy back the investment at any time by paying Buffett a 5 percent premium.

Investors have battered Bank of America's stock on fears that the largest U.S. bank by assets has yet to overcome billions of dollars in problem mortgage loans.

In recent weeks, investors have sold shares, worrying that the bank might need to raise outside capital -- as much as $50 billion by some estimates -- to cope with losses and meet new industry capital rules.

Bank of America shares have lost roughly a third of their value in August, and have lost half their value since the beginning of the year.

Buffett called Bank of America Chief Executive Brian Moynihan this week and offered to make the investment, a Bank of America spokesman said, adding that the deal was negotiated and consummated in a couple of days. ' Reuters

Wall St up at open on BofA/Berkshire deal

NEW YORK: U.S. stocks rose at the open on Thursday after Warren Buffett's Berkshire Hathaway Inc agreed to invest $5 billion in Bank of America Corp, sending financial shares higher.

The Dow Jones industrial average gained 74.55 points, or 0.66 percent, to 11,395.26. The Standard & Poor's 500 Index rose 13.08 points, or 1.11 percent, to 1,190.68. The Nasdaq Composite Index added 14.46 points, or 0.59 percent, to 2,482.15. ' Reuters

Moody's upgrades CIMB Bank's bank financial strength rating

KUALA LUMPUR: Moody's Investors Service upgraded CIMB Bank Bhd's bank financial strength rating (BFSR) to C- from D+, and which maps to a baseline credit assessment (BCA) of Baa2 from Baa3.

The ratings agency said on Thursday, Aug 25 it had also changed the rating outlook to stable from positive.

'CIMB Bank's foreign currency long-term/short-term deposit and issuer ratings of A3/P-1 and foreign currency senior unsecured MTN programme rating of (P)A3 remain unchanged. The outlook is stable,' it said.

Moody's also said it upgraded the local currency and foreign currency long-term/short-term issuer ratings of CIMB Investment Bank Bhd to A3/P-1 from Baa1/P-2. The outlook is stable.

It also upgraded the rating on non-cumulative guaranteed preference shares issued by a CIMB Bank subsidiary, SBB Capital Corporation (SBB),'' to Ba2(hyb) from Ba3(hyb). The outlook is stable.

As for PT Bank CIMB Niaga (CIMB-Niaga),'' Moody's'' had affirmed the local currency long-term/short-term deposit ratings of Baa3/P-3;'' foreign currency long-term/ short-term deposit ratings of Ba2/NP and foreign currency long-term issuer and subordinated debt ratings of Ba1.

Moody's said the outlook on all these ratings was stable.

The rating agency said the upgrade of CIMB Bank's BFSR reflects the bank's continued ability to maintain sound financials, deliver on its strategic objectives, and reduce its risk profile.

The stable outlook on the BFSR following the upgrade had also considered the challenges CIMB Bank faced in further improving its funding costs and asset quality significantly in light of intense competition among banks domestically and renewed volatility in the global economy.

GD Express 4Q net profit up 19.49% to RM2.82m

KUALA LUMPUR: GD EXPRESS CARRIER BHD [] (GDEX) net profit for the fourth quarter ended June 30, 2011 rose 19.49% to RM2.82 million from RM2.36 million a year earlier, due to higher demand for logistics services in the market.

It said on Thursday, Aug 25 that revenue for the quarter increased 18.3% to RM25.31 million from RM21.39 million in 2010.

Earnings per share rose to 1.10 sen from 0.92 sen in 2010, while net assets per share was 18 sen.

GDEX proposed a final single tier dividend of 12.5% or 1.25 sen per share in respect of the financial year ended June 30, 2011, subject to shareholders' approval at its forthcoming AGM.

For the financial year ended June 30, GDEX's net profit rose 17.3% to RM6.98 million from RM5.95 million in 2010, on the back of a 13.7% rise in revenue to RM93.07 million from RM81.84 million in 2010.

Reviewing its performance, GDEX said the favourable result was mainly due to the increase in the number of business days during the quarter as compared to the immediate preceding quarter.

On its prospects, GDEX said it expects the domestic economy to remain healthy.

'Whilst competition is expected to remain intense, GDEX will continue to focus in strengthening its service quality, increasing handling capacity and streamlining process flow to drive operational efficiencies to ensure the long term sustainability of the group.

'Barring unforeseen circumstances, the board is of the opinion that the group's prospects will remain positive,' it said.

Dijaya's earnings jump 687% to RM20.7m

KUALA LUMPUR: Dijaya Corp Bhd's earnings jumped 687% to RM20.75 million in the second quarter ended June 30, 2011 from RM2.63 million a year ago due to net gain of fair value adjustment and better margins for its projects.

The property developer said on Thursday, Aug 25 its revenue rose 1.3% to RM70.66 million from RM69.72 million. Its earnings per share were 4.56 sen versus 0.6 sen.

In the first half, the net profit surged 1,154% or 100 fold to RM38.89 million from only RM3.10 million. Its net profit edged up 0.2% to RM128.34 million from RM128.09 million.

It said the substantial increase in the earnings despite the marginal increase in revenue was mainly due to better margins for project profit recognised for the six months ended June 30, 2011 compared from the year before.

Dijaya said the projects are the Tropicana Grande, Casa Tropicana Block E, Pool Villas, Grand Villas and Link Villas.

'In additions, the increase in profit before taxation also included a net gain of fair value adjustment amounting to RM20.51 million arising from marketable securities and recognition of RM4 million liquidated and ascertained damages compensated from contractors,' it said.

US jobless claims up by 5,000

KUALA LUMPUR: Initial jobless claims for the week ended Aug 20 rose by 5,000 to 417,000 from 412,000 a week earlier, according to the US Labor Department (DOL).

In a statement on its website on Thursday, Aug 25, the DOL said the 4-week moving average was 407,500, an increase of 4,000 from the previous week's revised average of 403,500.

The advance seasonally adjusted insured unemployment rate was 2.9% the week ended August 13, a 0.1 percentage point decrease from the prior week's revised rate of 3%, it said.

The advance number for seasonally adjusted insured unemployment during the week ended August 13 was 3.64 million, a decrease of 80,000 from the preceding week's revised level of 3.72 million, it said.

The DOL said the 4-week moving average was 3.7 million, a decrease of 19,500 from the preceding week's revised average of 3.72 million.

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Tradewinds earnings increase 42% to RM124m

KUALA LUMPUR: TRADEWINDS (M) BHD [] saw its earnings increase by 42% to RM124.42 million in the second quarter ended June 30, 2011 from RM87.49 million a year ago, boosted by the favourable performances of the rice, PLANTATION [] and sugar divisions.

It said on Thursday, Aug 25 its revenue rose 23.9% to 1.593 billion from RM1.285 billion. Earnings per share were 41.97 sen compared with 29.51 sen. It declared dividend of 20 sen per share from 5.0 sen a year ago.

For the first half, its net profit increased by 30% to RM214.33 million from RM164.75 million. higher Profit before taxation rose to RM438.32 million from RM292.19 million.

'The increase was attributable to the improvements in the profit before taxation at the plantation and rice divisions by more than 100% and 67%, respectively, compared to the corresponding period last year,' it said.

Tradewinds said revenue rose at a slower pace of 18.1% to RM3.054 billion from RM2.585 billion.

'The increase was contributed by the plantation division, followed by rice and sugar divisions. The significant increase in revenue at the plantation division was due to higher selling price and production of palm products.

'As for the rice division, the increase in revenue was attributable to higher volume of rice and non-rice sold, whilst for the sugar division, the higher average selling price of sugar was the main cause for the higher revenue,' it said.

Apple shares under pressure after Jobs resignation

SAN FRANCISCO/LOS ANGELES: Shares in Apple Inc were marked lower by investors on Thursday, Aug 25 as the company faced a future without its founder and visionary Steve Jobs at the helm.

Jobs resigned as as CEO on Wednesday and passed the reins to his right-hand man Tim Cook, saying he could no longer fulfil his duties, but making no mention of the poor health that has forced him to take a back seat this year.

Jobs, who fought and survived a rare form of pancreatic cancer and revolutionised the TECHNOLOGY [] arena with the iPod, iPhone and iPad, is deemed the heart and soul of a company that became the most valuable in the world for a brief period this year.

"I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple's CEO, I would be the first to let you know. Unfortunately, that day has come," Jobs wrote in a brief letter announcing his resignation.

The letter and a separate statement from Apple raised more questions than it answered about Jobs' health and the future of the company. Jobs will continue as chairman.

While it is unlikely that his departure as CEO will derail Apple's ambitious product-launch roadmap in the near term, there are concerns about whether the company will be as creative without its founder and visionary at the helm.

Apple's stock traded down 4.1 percent in Frankfurt on Thursday, following a drop of as much as 7 percent in U.S. after-hours trading when Jobs' departure was announced.

In the company statement, Apple co-lead director Art Levinson on behalf of the board praised Jobs' "extraordinary vision and leadership" and said he would continue to serve the company with "unique insights, creativity and inspiration".

Jobs' battle with pancreatic cancer, which has stretched over several years, has been of deep concern to Apple fans, investors and the company's board.

Over the past two years, even board members have confided to friends their concern that Jobs, in his quest for privacy, wasn't being forthcoming with directors about the true condition of his health.

Jobs has been on medical leave since Jan. 17, with his duties being filled by Cook, who was chief operating officer.

The 56-year-old Jobs had briefly emerged from his medical leave in March to unveil the latest version of the iPad and later to attend a dinner hosted by President Barack Obama for technology leaders in Silicon Valley.

But his often-gaunt appearance had sparked questions about how bad his illness was, and his ability to continue at Apple.

In each of Jobs' three health-related absences, Cook has taken over the helm.

The 50-year-old Alabama native, a former Compaq executive and an acknowledged master of supply-chain management, remains largely untested in Wall Street's view, however.

One Silicon Valley CEO, who declined to be identified because of the sensitive issues involved, said the tone of Jobs' statement indicated his health might be worse than feared.

The Apple chieftain has earned a reputation for commanding every aspect of operations -- from day-to-day running to broad strategic decisions -- suggesting he would not give up the job if he had a choice.

"It's really sad," the CEO told Reuters. "No one is looking at this as a business thing, but as a human thing. No one thinks that Steve is just stepping aside because he just doesn't want to be CEO of Apple anymore."

"It feels like another shoe is going to drop."

Brand research company Millward Brown said Apple's brand, which it values at over $153 billion, should remain intact.

"Steve Jobs resignation from Apple is sad for him as it presumably presages more illness. However he has left the Apple Brand in rude health so that the company is still poised for future growth," global brands director Peter Walshe wrote.

"The future direction is mapped out, the successor is in place (also a designer by background), and consumers rate the brand uniquely 'creative', 'fun' and 'adventurous'."

AGAIN, DEEP BENCH

While Jobs did not give details on the state of his health, oncologists who have not treated the Apple founder said he could be facing several problems tied to his rare form of pancreatic cancer and subsequent liver transplant.

Such problems include possible hormone imbalances or a recurrence of cancer that is harder to fight once the body has already been weakened.

"Steve Jobs is the most successful CEO in the U.S. of the last 25 years," Google Inc Chairman Eric Schmidt said in a statement.

"He uniquely combined an artist's touch and an engineer's vision to build an extraordinary company."

Nokia CEO Stephen Elop said in a statement: "Steve Jobs is a visionary in the computing industry. We look forward to both Steve and his team having a positive impact on our industry for many years to come."

Elop was appointed last year to lead Nokia's fightback against Apple, whose iPhone posed a challenge that the world's biggest cellphone maker has yet to meet.

Analysts again expressed confidence in the Apple bench, headed by supply-chain maven Cook.

"I will say to investors: 'Don't panic, and remain calm -- it's the right thing to do. Steve will be chairman and Cook is CEO," said BGC Financial analyst Colin Gillis.

Nomura's Global Technology Specialist Richard Windsor agreed, although he said rival smartphone makers would be quick to take advantage of any Apple weakness.

"This looks like a pretty smooth transition with the slight risk of a dent to its image if the next product launches are not perfect. Its competitors are waiting to pounce and here we think that HTC has the most to gain," he wrote.

Apple previously did not have a chairman, but had two independent co-lead directors.

In his letter, which was addressed to the Apple board and the Apple community, Jobs said: "I hereby resign as CEO of Apple. I would like to serve, if the Board sees fit, as Chairman of the Board, director and Apple employee." - Reuters

#Update* Bumi Armada earnings slump 18% to RM60m

KUALA LUMPUR: Bumi Armada Bhd's earnings fell 18% to RM60.26 million in the second quarter ended June 30, 2011 from RM73.65 million a year ago due to higher finance costs and taxation and higher vessel operating costs.

It said on Thursday, Aug 25 that revenue rose 40.9% to RM392.96 million from RM278.85 million. Earnings per share were 2.64 sen compared with 3.69 sen.

For the first half, its net profit was marginally higher by 1.4% to RM142.33 million from RM140.30 million a year ago. Its revenue increased by 42% to RM769.12 million from RM541.31 million.

Bumi Armada said the higher 1H revenue was mainly due to its new oilfield services (OFS) segment which included the ongoing conversion and sale of an FSO to Petrofac of RM158.0 million, and higher utilisation from its derrick pipelay barge, Armada Installer in Turkmenistan of RM104 million which commenced operation in May 2010.

However, these was offset by the reduction in floating production storage offloading system (FPSO) operating fee of RM35.0 million. This was due to a renegotiation of Armada Perdana's contract effective June 2010.

Another factor was higher revenue in 2010 due to reimbursement of additional costs related to operations on Armada Perkasa which were previously expensed in 2008 and 2009.

'The group also posted a year to date increase in EBITDA of RM47.4 million or 15% on the back of its higher revenue. The EBITDA margin decreased from 59% to 48% in the current year to date mainly due to the ongoing conversion and sale of an FSO for the Sepat project recognised in the new OFS segment and fair value charge of a call option granted to an executive director amounting to RM6.2 million, which was expensed off,' it said.

DHB-Hicom 1Q net profit falls 42% to RM91.07m

KUALA LUMPUR: DRB-HICOM BHD [] net profit for the first quarter ended June 30, 2011 fell 42% to RM91.07 million from RM157.78 million a year earlier on lower share of results of associated companies namely Honda Malaysia Sdn Bhd due to shortages of CKD packs following the Japan earthquake/tsunami in March 2011.

It said on Thursday, Aug 25 that its revenue for the quarter rose 1.93% to RM1.58 billion from RM1.55 billion in 2010.

Earnings per share declined to 4.71 sen from 8.16 sen in 2010, while net assets per share was RM2.63.

DRB-Hicom said that in the previous corresponding period, the group had recognised a one-off exceptional gain i.e. negative goodwill of RM71.22 million, arising from the accretion of equity interest in EON Bhd. Hence, profit reported during the period was RM223.48 million.

Reviewing its performance, DRB-Hicom group managing director Datuk Seri Mohd Khamil Jamil said the recent downgrading of the United States sovereign rating, European debt crisis, and the continuous increase in inflation would potentially affect the Malaysian economy.

Against this challenging background, the group would continue to pursue various cost management initiatives and review the group's business approaches to mitigate any negative and adverse impact on the group's financial results for the financial year ending March 31, 2012, he said.

Mohd Khamil however said that he was positive that the effects of the tragedy in Japan would not be a prevailing factor in the Group's future performances.

'This like most disasters was unexpected and unavoidable. Nevertheless, DRB-Hicom with its diverse business background is built to withstand various challenges thrown in its way.

'Despite the dip in the automotive sector's revenue, I am proud to say that the strategic re-alignment in our services sector over the last three years enabled the company to hold strong despite cyclical challenges,' he said.

Mohd Khamil said that with the completion of the acquisition of Pos Malaysia on July 1, 2011, it also meant that the group would be able to further push synergistic opportunities within the group and that this would eventually contribute positively to its future earnings.

''

Carlsberg 2Q net profit edges up 0.64% to RM31.02m

KUALA LUMPUR: CARLSBERG BREWERY MALAYSIA BHD [] net profit for the second quarter ended June 30, 2011 edged up 0.64% to RM31.02 million from RM30.81 million a year earlier, due mainly to the strong first quarter performance arising from higher domestic sales particularly during the peak Chinese New Year festive period.

It said on Thursday, Aug 25 that revenue for the quarter rose 3.4% to RM345.51 million from RM334.15 million in 2010.

Earnings per share was 10.15 sen compared to 10.08 sen in 2010, while net assets per share was RM1.82.

Carlsberg declared a gross interim dividend of 5 sen per 50 sen share to be paid on Oct 7.

For the six months ended June 30, Carlsberg's net profit rose 16.5% to RM79.96 million from RM68.66 million on the back of higher revenue of RM752.73 million compared to RM712.61 million in 2010.

In a statement Aug 25, Carlsberg managing director Soren Ravn said the company benefitted from its creative 2011 Chinese New Year festive campaign and the successful execution of Carlsberg's new global positioning with the tag line, 'That Calls for a Carlsberg'.

He said its flagship Carlsberg brand remains the No 1 beer brand in Malaysia and that the company continued to focus and grow its premium portfolio through its subsidiary Luen Heng F & B Sdn Bhd.

'Our position in the premium beer category was further strengthened with the recent launch of Kronenbourg 1664 Blanc.

'Our associate company, Lion Brewery Ceylon PLC also delivered strong profit growth,' he said.

On the outlook for the rest of the year, Ravn said Carlsberg Malaysia expects to continue to benefit from the investment in Carlsberg's new global campaign, 'That Calls for a Carlsberg', which was now aligned in over 140 countries around the world.

'The new Carlsberg large bottle format, introduced in the second quarter has been extremely well received by trade customers, consumers and other stakeholders,' he said.

''

Megasteel severely impacted by HRC imports

KUALA LUMPUR: Megasteel Sdn Bhd's expansion plan and proposal to invite foreign partners to invest in the group's steel operations have been jeopardised by the imports of hot rolled coils (HRC).

It said on Thursday, Aug 25 the rising imports had severely affected its operations and performance and it might have to start retrenching its workers, despite calls to the government, urging it to curb HRC imports.

It refuted the statement by the Ministry of International Trade & Industry (MITI) that the increase in imports of HRC by 35% from January to Sept 30, 2010 'have not caused or threaten to cause serious injury to the domestic industry'.

'Despite the existing import duty of 25% on HRC, a substantial amount of imports are coming in without duty, that is 0% under Asean CEPT (Common Effective Preferential Tariff) and duty exemption given to qualified manufacturers,' it said.

Megasteel said the rest include HRC by importers who circumvented the duty structure. The 25% import duty is also levied on the downstream products, that is cold roll coils (CRC), coated sheets as well as pipes and tubes.

The continued imports, it said, was causing hardship to the companies and the workers. Megasteel and its sister companies have 4,600 employees in the Lion steel complex in Banting and also those employed in the downstream, supporting and ancillary industries.

It said it may have to start retrenching if the situation continues. 'It will also jeopardise the company's plans to invest further in upstream and expansion projects as well as the plans to invite foreign partners to invest in the group's steel operations,' it said.

Megasteel said it understood the government was taking measures to strengthen the industry by plugging the loopholes and leakages taking place. This will put a stop to manipulations of imports and bring back the price and market stability to the HRC sector.

'Megasteel is also looking into other avenues like anti-dumping to address the problem of excessive imports at dumping prices into the country,' it said.

Due to the non-level playing field created by Free Trade Agreements, many steel producing countries have imposed safeguard measures to protect their local steel industries.'' India, Indonesia and the Philippines are the most frequent users of safeguard proceedings in Asia, with 33, 11 and nine respectively.

Indonesia has filed 11 investigations of which five are related to the steel industry. In particular, it has imposed anti-dumping duty of 48.46% on HRC from Malaysia and six other countries, as well as safeguard measures on steel wire nails and steel wire ropes. It has also tightened its industrial standards as non-tariff barriers against steel imports.

Thailand has imposed anti-dumping on HRC from 16 countries, including Malaysia with a duty of 23.57%, besides enforcing its industrial standards as a non-tariff barrier.

'The implementation of all these measures by Indonesia and Thailand has in fact created a conducive and stable environment, attracting foreign investments into their steel industry by major steel mills such as Posco, Nippon Steel, Wuhan Steel etc,' it said.

Megasteel said it would discuss with the government on building a supportive environment for the local steel industry to grow, upgrade and expand in the interests of both the upstream and downstream industries.

''

''

Bumi Armada earnings slump 18% to RM60.26m

KUALA LUMPUR: Bumi Armada Bhd's earnings fell 18% to RM60.26 million in the second quarter ended June 30, 2011 from RM73.65 million a year ago due to higher finance costs and taxation and higher vessel operating costs.

It said on Thursday, Aug 25 that revenue rose 40.9% to RM392.96 million from RM278.85 million. Earnings per share were 2.64 sen compared with 3.69 sen.

For the first half, its net profit was marginally higher by 1.4% to RM142.33 million from RM140.30 million a year ago. Its revenue increased by 42% to RM769.12 million from RM541.31 million.

Bumi Armada said the higher 1H revenue was mainly due to its new oilfield services (OFS) segment which included the ongoing conversion and sale of an FSO to Petrofac of RM158.0 million, and higher utilisation from its derrick pipelay barge, Armada Installer in Turkmenistan of RM104 million which commenced operation in May 2010.

However, these was offset by the reduction in floating production storage offloading system (FPSO) operating fee of RM35.0 million. This was due to a renegotiation of Armada Perdana's contract effective June 2010.

Another factor was higher revenue in 2010 due to reimbursement of additional costs related to operations on Armada Perkasa which were previously expensed in 2008 and 2009.

'The group also posted a year to date increase in EBITDA of RM47.4 million or 15% on the back of its higher revenue. The EBITDA margin decreased from 59% to 48% in the current year to date mainly due to the ongoing conversion and sale of an FSO for the Sepat project recognised in the new OFS segment and fair value charge of a call option granted to an executive director amounting to RM6.2 million, which was expensed off,' it said.

DHB-Hicom 1Q net profit falls 42% to RM91.07m

KUALA LUMPUR: DRB-HICOM BHD [] net profit for the first quarter ended June 30, 2011 fell 42% to RM91.07 million from RM157.78 million a year earlier on lower share of results of associated companies namely Honda Malaysia Sdn Bhd due to shortages of CKD packs following the Japan earthquake/tsunami in March 2011.

It said on Thursday, Aug 25 that its revenue for the quarter rose 1.93% to RM1.58 billion from RM1.55 billion in 2010.

Earnings per share declined to 4.71 sen from 8.16 sen in 2010, while net assets per share was RM2.63.

DRB-Hicom said that in the previous corresponding period, the group had recognised a one-off exceptional gain i.e. negative goodwill of RM71.22 million, arising from the accretion of equity interest in EON Bhd. Hence, profit reported during the period was RM223.48 million.

Reviewing its performance, DRB-Hicom group managing director Datuk Seri Mohd Khamil Jamil said the recent downgrading of the United States sovereign rating, European debt crisis, and the continuous increase in inflation would potentially affect the Malaysian economy.

Against this challenging background, the group would continue to pursue various cost management initiatives and review the group's business approaches to mitigate any negative and adverse impact on the group's financial results for the financial year ending March 31, 2012, he said.

Mohd Khamil however said that he was positive that the effects of the tragedy in Japan would not be a prevailing factor in the Group's future performances.

'This like most disasters was unexpected and unavoidable. Nevertheless, DRB-Hicom with its diverse business background is built to withstand various challenges thrown in its way.

'Despite the dip in the automotive sector's revenue, I am proud to say that the strategic re-alignment in our services sector over the last three years enabled the company to hold strong despite cyclical challenges,' he said.

Mohd Khamil said that with the completion of the acquisition of Pos Malaysia on July 1, 2011, it also meant that the group would be able to further push synergistic opportunities within the group and that this would eventually contribute positively to its future earnings.

''

Banks, blue chips drag KLCI lower

KUALA LUMPUR: Losses at banking and blue chip stocks dragged the FBM KLCI lower on Thursday, Aug 25, while most key Asian markets closed higher and European markets opened strongly.

At key Asian and European markets, investors took an optimistic view of how strongly the Federal Reserve will commit to supporting the economy at a gathering this week, according to Reuters.

Fed chief Ben Bernanke is due to address central bankers at an annual symposium in Jackson Hole, Wyoming, on Friday. His speech last year laid the groundwork for the Fed's US$600 billion bond-buying program, to revive the US economy.

While much doubt Bernanke will immediately commit to conducting the third round of quantitative easing, or QE3, investors generally expect him to stress that the central bank stands ready to act if necessary, said Reuters.

The FBM KLCI fell 4.41 points to 1,464.74, weighed by losses at RHB Capital, CIMB, Axiata and Maybank.

Losers beat gainers by 429 to 240, while 311 counters traded unchanged. Volume was 833.92 million shares valued at RM2.02 billion.

At the regional markets, the Shanghai Composite Index rose 2.92% to 2,615.26, Japan's Nikkei 25 added 1.54% to 8,772.36, Hong Kong's Hang Seng Index gained 1.47% to 19,752.48, South Korea's Kospi edged up 0.56% to 1,764.58 and Singapore's Straits Times Index rose 1.69% to 2,765.74.

Meanwhile, Taiwan's Taiex fell 1.23% to 7,410.87.

On Bursa Malaysia, RHB Capital was the top loser and lost 58 sen to RM8.32; CIMB fell 35 sen to RM7.25, Maybank one sen to RM8.73, F&N 32 sen to RM16.50, Axiata 22 sen to RM4.62, Far East 20 sen to RM7, Rapid 18 sen to RM1.61 and Perak Corp 17 sen to RM1.19.

Among the gainers, BAT added 98 sen to RM44.48, Petronas Dagangan 40 sen to RM17.60, Genting 26 sen to RM9.78, PPB 22 sen to RM17.10, Genting PLANTATION []s 20 sen to RM7.24, KLK and DiGi 16 sen each to RM21.48 and RM30.10, Nestle and EPIC 12 sen each to RM48.13 and RM3.05, while Kian Joo added 11 sen to RM2.08.

CIMB was the most actively traded counter with 55.55 million shares done.

Other actives included Axiata, Telekom, DVM, Maybank, AirAsia, HWGB, MUI and Sime Darby.

YTL Corp full yr net profit up 23.6% to RM1.059b

KUALA LUMPUR: YTL YTL CORPORATION BHD []'s earnings increased 23.6% to RM1.059 billion (US$355.4 million) in the financial year ended June 30, 2011 from RM856.8 million (US$287.5 million) a year ago.

It said on Thursday, Aug 25 its revenue rose 12.5% to RM18.570 billion in FY ended June 2011 compared with RM16.50 billion a year ago.

YTL group managing director Tan Sri Francis Yeoh Sock Ping said the financial performance was 'driven primarily by our power generation, water and cement operations and overseas property development projects'.

Yeoh said the group's key utilities comprised of PowerSeraya, one of the three largest electricity companies in Singapore, Wessex Water in the UK and the Paka and Pasir Gudang power stations in Malaysia.

The board declared a first interim single tier dividend of 2.0 sen or 20% per ordinary share of 10 sen each for FY ended June 30, 2011. The book closure and payment dates for the dividend are Nov 9 and Nov 24 respectively.

Ranhill posts larger net loss of RM34m

KUALA LUMPUR:'' RANHILL BHD [], which is being taken private'' by its major shareholders, posted larger net loss of RM34.47 million in the quarter ended June 30, 2011 compared with losses of RM21.15 million a year ago.

It said on Thursday, Aug 25 that revenue fell 22.4% to RM499.67 million from RM644.15 million a year ago. Loss per share was 5.77 sen compared with 3.54 sen a year ago.

It said the lower revenue was mainly due to lower recognition of revenue from Libya Housing project and Senai Desaru Expressway project.

'The loss after tax attributable to equity holders (LATMI) of RM34.5 million, a RM13.3 million reduction compared to the preceding year corresponding quarter's LATMI of RM21.2 million mainly due to the premium that have to be paid due to early redemption of the US dollar bond as per the trust deed. In addition, the losses are also due to the charging out of the total cost yet to be amortised in relation to the early redemption of both the US dollar bond and Ranhill Powertron II's term loan,' it said.

For the 12-month period, it made a net profit of RM5.40 million, down 64.7% from RM15.34 million in the previous corresponding period. Revenue declined by 6% to RM1.99 billion from RM2.12 billion.

On the prospects, Ranhill said with the recently awarded oil and gas contract by Petroliam Nasional Bhd, the group expected continuing growth from the engineering works of its oil & gas sector arm through Ranhill WorleyParsons Sdn Bhd.

However, the suspension of works in Libya and its subsequent termination had a significant impact to the CONSTRUCTION [] division.

'The eventual termination of the Libya project had depleted the Group's order book substantially. However, the company will continue to participate in tendering for new construction project,' it said.

Ranhill expected the water and power business to provide steady and recurring revenue, income and cash flow to the group.

'The group expects the revenue and profit contribution from the power business to increase as the new 190MW combined cycle power plant achieved the completion of its commercial operation date on March 23, 2011,' it said.