SILK Holdings to be profitable in 'couple of years'

KUALA LUMPUR: SILK Holdings Bhd is confident the company will be able to return to profitability in a couple of years as traffic volume picks up for its tolled highway operations and an improvement in the marine support services.

Chairman Datuk Mohd Azlan Hashim said on Friday, Oct 28 that "we expect with the continued increase in traffic flow in that area, these losses will eventually be wiped out and there will be a turnaround in profitability".

The highway division's loss of RM26 million for the financial year ended July 31, 2010 was reduced to RM19 million in FY11, he told reporters after the AGM.

He said the decline in losses, coupled with a continued increase in traffic flow in the Kajang area, SILK Holdings would be able to make a profit in the next couple of years.

"We've been experiencing traffic flow rates of 17% per annum for two years running now. There is tremendous growth potential and as development happens in that area, traffic is generated," he said. Currently, the area is low density, he added.

On their marine support services division, he said group was expanding its fleet and renewing with more modern vessels. Currently, they own 14 vessels and expect to acquire a few more vessels in the next few months.

Azlan said that the oil and gas sector in Malaysia is an exciting area to be in as it was one of the national key economic areas to be developed under the Economic Transformation Programme.

"We are positioning ourselves to serve that need. At the moment, a quarter of the group's revenues are contributed by the highway side and the remaining is by the marine support services arm," said Azlan.

"Having said that, the highway business takes time to build up as the concession is for 36 years and we are only in the early part now," he added.

"In the highway business, there is heavy capital outlay and a long gestation period," he said. "You have to be patient. The initial years will show losses but once you hit your critical mass in terms of traffic, then you will be out of the woods."

For the financial year ended July 31, 2011,SILK recorded net loss of RM11.24 million compared with net loss of RM10.03 million in FY10.

Tasek 3Q earnings dn 32.9% to RM22.10m

KUALA LUMPUR: TASEK CORPORATION BHD []'s earnings fell 32.9% to RM22.10 million in the third quarter ended Sept 30, 2011 (3QFY11) from RM32.90 million a year ago, due to lower sales.

It said on Friday, Oct 28, revenue fell 7.5% to RM132.99 million from RM143.78 million. Earnings per share were 17.82 sen compared with 20.63 sen.

Tasek Corporation said the lower earnings were attributed to the lower volume in domestic cement sales following the Hari Raya holidays during the quarter. Competitive pricing in the market coupled with higher production costs also contributed to the lower results, it added.

However, the group said 3Q11 results had benefited from higher interest income it received during the reporting quarter.

Moving forward, the group is confident that demand and pricing for cement and ready-mixed concrete will remain positive for the next quarter.

For the first nine months ended Sept 30, 2011, profit fell 8.5% to RM69.72 million from RM76.18 million a year ago. Revenue fell 3.4% to RM398.95 million from RM413.08 million.

#Flash* Tenaga 4Q net loss RM453.90m

KUALA LUMPUR: TENAGA NASIONAL BHD [] extended its losses for the second consecutive quarter, posting net loss of RM453.90 million in the fourth quarter ended Aug 31, 2011 versus net profit of RM555.20 million a year ago.

It said on Friday, Oct 28 that revenue was higher at RM9.12 billion compared with RM8.07 billion a year ago. Loss per share was 8.33 sen compared with earnings per share of 10.22 sen.

For the financial year ended Aug 31, 2011, it net profit plunged to RM499.50 million from RM3.20 billion in FY10. Revenue was RM32.20 billion compared with RM30.32 billion.

Timber, timber products exports to hit RM21b this yr

KUALA LUMPUR: Malaysia's timber and timber-derived products exports are expected to be around RM20 billion to RM21 billion this year, almost equalling last year's exports totalling RM20.5 billion.

Deputy Minister of PLANTATION [] Industries and Commodities Datuk Hamzah Zainudin said the projection was in tandem with the sluggish global economic
climate influencing demand and exports.

"The main recipient countries that receive our timber exports like the United States, Japan and several european nations are grappling with economic
crisis, thus demand from them are uncertain at the moment.

"Earlier, we projected our timber export value to increase by six to seven per cent this year, but if we can maintain last year's export worth, I think
it's good enough (given the current sluggish economic climate)," he told reporters after opening a national seminar on timber industry in the Industrial
Building System (IBS) here on Friday, Oct 28.

Hamzah said political uncertainties in several Middle East countries are also expected to influence timber exports value as several countries from that
region imported timber and timber-derived products from Malaysia.

He said although prices of other CONSTRUCTION [] materials like cement and steel are uncertain in the market, that situation did not influence demand for
timber so much as timber imports depended on requirements and affordability of a country.

On domestic market, Hamzah said the local timber consumption was about RM7 billion a year, with the housing sector being the biggest contributor to the figure.

To encourage higher use of local timber and boost its export value, he said the Malaysian Timber Industry Board (MTIB) has embarked on a replanting
programme to plant 25,000 timber trees of various species every year.

"Over the next five years, we expect to plant about 125,000 timber trees. This move will ensure that we can meet market demand," he added.
The seminar, jointly hosted by MTIB and Universiti Putra Malaysia, is to impart knowledge and provide exposure to industry players on opportunities to
explore in the IBS particularly using timber as a construction material. - Bernama

Harvest Court appoints Chan, Nazifuddin to the board

KUALA LUMPUR: HARVEST COURT INDUSTRIES BHD [] has appointed two officials of Sagajuta group of companies, Datuk Raymond Chan Boon Siew and Mohd Nazifuffin Najib to the board with effect from Friday, Oct 28.

The timber manufacturing company said on Friday that Chan, 39, was appointed as a non-independent, non-executive director of the company and Nazifuffin, 28, as an independent and non-executive director.

Chan owns 23.808 million shares or 13.85% in Harvest Court which he had acquired in several off-market trades at 20 sen each on Oct 18.

He is also the managing director of the Sagajuta group of company ' a post he held since 1995.'' Chan was appointed managing director of 1Green Enviro Sdn Bhd in 2011.

Meanwhile, Nazifuffin is the chairman of 1Green Enviro Sdn Bhd, Magna Healthcare Sdn Bhd, Cahaya Pedoman Sdn Bhd, Tribus Sdn Bhd and Sagajuta (Sabah) Sdn Bhd.

He also a director of Kingtime International Limited and Dynac Sdn Bhd.

Raja Teh Maimunah appointed Hong Leong Islamic Bank CEO

KUALA LUMPUR: Veteran banker Raja Teh Maimunah Raja Abdul Aziz has been appointed managing director/chief executive officer of Hong Leong Islamic Bank (HLISB), a unit of HONG LEONG BANK BHD [], with effect from Friday, Oct 28.

Raja Teh Maimunah, with over 18 years of experience in the financial industry focusing on investment banking and Islamic finance, was the global head of Islamic markets at Bursa Malaysia prior to her appointment in HLISB.

Hong Leong Bank group managing director Yvonne Chia said: 'We have much to look forward to as a strong and united Hong Leong Islamic Bank with the new leadership.

'I am confident with Raja Teh's leadership, HLISB will continue to innovate to be a preeminent player in the Islamic financial services industry.'

Raja Teh Maimunah was also the chief corporate officer and head of international Business at Kuwait Finance House Malaysia and CEO of Bank AlKhair Malaysia (previously Unicorn Investment Bank).

She also served in CIMB Investment Bank covering the debt and equity origination and equity sales and was responsible for the establishment of the investment banking division in RHB Investment bank in 2004.

She is also the adviser on Islamic banking and finance to the World Islamic Economic Forum Foundation and holds an LLB (Hons) from the University of East London.

Thai c.bank cuts GDP f'cast as floods hit industry

BANGKOK: Thailand's central bank slashed its 2011 economic growth forecast to 2.6 percent from 4.1 percent on Friday, Oct 28 because of flooding and said it was ready to call a special meeting on interest rates, raising speculation about a rate cut.

It faces a dilemma over rates because it expects inflation to remain high next year, forecasting price rises of 3.5 percent versus 3.8 percent this year, with core inflation at 2.5 prevent after an expected 2.4 percent this year.

In the most recent Reuters poll, economists expected the policy rate to still be at the current 3.50 percent at the end of next year but the chances of a cut to help industry are rising.

"Temporary rate reductions at the next meeting or in some interim special policy meeting cannot be ruled out, but that is not our base case forecast for now," said Ramya Suryanarayanan, an economist at DBS Bank in Singapore.

ReCONSTRUCTION [] after the floods and other programmes promised by the government ahead its election in July will help push up economic growth in 2012 to 4.1 percent, the Bank of Thailand said, but it could also add to inflationary pressure.

With the flooding far from over and the final cost uncertain, the central bank said it might review its growth forecasts again at its next policy meeting on Nov. 30.

"The main factor affecting GDP is the floods, which have vastly damaged the agricultural and industrial sectors," Assistant Governor Paiboon Kittisrikangwan said.

"The impact will be mostly felt this year. But next year after the reconstruction, domestic demand and government measures should lend support," he told a news conference.

Thailand is a manufacturing hub for international companies in the car and electronics sectors. Its worst flooding in half a century has closed seven huge industrial estates this month, disrupting international supply chains.

The capital, Bangkok, which accounts for 41 percent of GDP, is faced with extensive flooding this weekend.

The flooding plus global economic uncertainty prompted the central bank to leave its policy rate steady at 3.50 percent last week, pausing after over a year of tightening that has brought the rate up from a record low of 1.25 percent.

The central bank aims to keep core inflation -- which excludes energy and fresh food prices -- in a range of 0.5-3.0 percent. Core inflation was pushing up against the top of that range at 2.92 percent in September.

CONTRACTION

Even before the flooding, Southeast Asia's second-largest economy was having a tough time, contracting 0.2 percent in the second quarter from the first under the impact of the Japanese disaster. .

"In terms of the flood impact on factory output and business sectors, it seems like capacity utilisation for October will be very low," said Rahul Bajoria, an economist at Barclays Capital in Singapore.

"A drop in industrial production to the tune of 15-20 percent month-on-month cannot be ruled out.

Finance Minister Thirachai Phuvanatnaranubala told Reuters last week the economy would probably grow by little more than 2 percent this year . It grew 7.8 percent in 2010.

The BOT's forecast of 2.6 percent for this year compares with the 3.8 percent in a quarterly Reuters poll . The poll was conducted this month before the disaster worsened but the forecast was already the lowest in Southeast Asia. .

Indonesia, Southeast Asia's biggest economy and with ambitions to rival it as a manufacturing hub, is expected to grow 6.5 percent this year and Singapore 5.1 percent.

To help with the flooding, the cabinet approved a 325 billion baht ($10.6 billion) package on Tuesday to help firms, small vendors and individuals with soft loans to be arranged or partly guaranteed by the government. .

It earlier approved an increase in the budget deficit to 400 billion baht for the fiscal year from Oct. 1 from 350 billion.

Because of the floods and a slowdown in overseas markets, the central bank cut its forecast for export growth this year to 20.1 percent from 22.4 percent and to just 7.9 percent for 2012 from 10.4 percent. Exports rose 28.5 percent in 2010.

Petronas licence for all O&G upstream biz in Malaysia

KUALA LUMPUR: Petroliam Nasional Bhd has categorically stated that all companies wishing to start or continue any business or service related to Malaysia's oil and gas upstream operations and activities must apply for a licence from the national oil company.

Petronas said on Friday, Oct 28 that the policy, enforced under the regulations following the enactment of the Petroleum Development Act, 1974, has not changed, and 'applies to all local and foreign companies, service providers and suppliers'.

It was responding to recent media reports claiming that Petronas had decided 'to do away' with its licensing system for companies involved in Malaysia's upstream O&G industry.

Hirotako board not seeking alternative takeover offer

KUALA LUMPUR: HIROTAKO HOLDINGS BHD []'s board of directors does not intend to see an alternative party to make a takeover offer for the securities of the company.

It said on Friday, Oct 28 under the Malaysian Code on Take-Overs and Mergers, 1998, the board will appoint an independent adviser for purposes of the offer.

'The notice will be posted to the shareholders of Hirotako Holdings within seven days of its receipt,' it said.

On Thursday, MBM RESOURCES BHD [] offered 97 per share which was nine sen above the pre-suspension price of 88 sen and only 5.0 sen per warrant in its takeover offer.

OSK Research said at 97 sen, this was 14% above Hirotako's five-day market average closing prices of 85 sen a share and 5% above the warrant's exercise price of 92 sen a share.

At 12.30pm, Hirotako share price rose six sen to 94 sen with 23.54 million shares done while the warrants fell 8.5 sen to 15 sen with 66.51 million units done.

Can the KLCI test the 1,500?

KUALA LUMPUR: Key regional markets extended their gains in the morning session on Friday, Oct 28, as investors bet that equities could continue to rise after European leaders put together a one trillion euro rescue package.

The question on investors' minds is whether the run-up is sustainable and if so, can the FBM KLCI test the formidable 1,500 level in the short term.

At midday, the 30-stock index was up 11.64 points or 0.78% to 1,482.57. However, year-to-date, it is down 2.40%. Turnover was heavy with 1.22 billion shares done valued at RM1.127 billion. There were 456 gainers, 260 losers and 303 stocks unchanged.

Among the regional markets, Japan's Nikkei 225 rose 0.98% to 9,014.22, Hong Kong's Hang Seng Index added 1.89% to 20,061.44, Shanghai's Composite Index rose 1.10% to 2,462.38 and South Korea's Kospi 0.43% to 1,930.26. Singapore's Straits Times Index added 1.45% to 2,888.89.

Reuters reported the head of Europe's bailout fund as saying on Friday he does not expect to reach a conclusive deal with Chinese leaders during a visit to Beijing but expects the surplus-rich country will continue to buy bonds issued by the fund.

Klaus Regling, chief executive of the European Financial Stability Facility (EFSF), also said the bailout deal with Greece was an exceptional case and he saw no need to repeat it for other nations.

Reuters said The EFSF, set up last year and so far used to bail out Portugal and Ireland, is a 440 billion euro fund based on guarantees from all euro zone member states, raising capital on international markets by selling bonds.

Investors want to know how the 440 billion euro EFSF rescue fund will be leverage to 1 trillion euros to put a safety net under bigger euro zone states, such as Spain and Italy and prevent them from being swept up by the crisis.

Meanwhile, the ringgit strengthened against the US dollar to 3.0750 while crude palm oil third-month futures fell RM6 to RM2,974 per tonne. US light crude oil fell 34 cents to US$93.62.

At Bursa, GENTING BHD []'s 36 sen jump to RM10.66 pushed the KLCI up 3.08 points while CIMB's 11 sen gain to RM7.39, gave the index a 1.89 point increase.

Among the consumer stocks, BAT was the top gainer, up 70 sen to RM46, Nestle 54 sen to RM50, Dutch Lady 40 sen to RM20.36, F&N 26 sen to RM16.66 and GAB 14 sen to RM10.70.

KLK rose 44 sen to RM21.04, MMHE 25 sen to RM6.37 while MAHB added 34 sen to RM6.22.

Hirotako warrants were the most active with 66.51 million units done. It fell 8.5 sen to 15 sen as investors reacted to the 5.0 sen offered by MBM Resources in the takeover offer. Hirotako shares added six sen to 94 sen.

The decliners were Tong Herr and Atlan, down 14 sen each to RM2 and RM3.02 while BLD PLANTATION []s gave up 10 sen to RM6.80 and CI Holdings shed 10 sen to RM4.90.