29 March 2013
The Edge > Yinson's TP raised after FY13 earnings jump
KUALA LUMPUR (Mar 29): Analysts have raised their target prices (TP) for YINSON HOLDINGS BHD [], after the oil and gas (O&G) services provider’s full-year core net profit increased by 40.5% year-on-year.
In their notes today, Maybank IB and Kenanga Research increased their target prices on Yinson by 34 sen (up 13.39%) and 15 sen (up 5.54%) respectively. Their new target prices are RM2.88 and RM2.86.
Maybank’s analyst Chong Ooi Ming said while Yinson did not declare dividend for its fourth quarter ended January 31, 2013 (4QFY13), he expects the firm to declare a 2.5 sen-per-share dividend when its AGM is getting closer.
Kenanga’s Cezanne See said she too believes a dividend could be in the horizon, with no tentative date given. Yinson’s core net profit of RM9 million in 4QFY13 was up 10.5% quarteron- quarter and posted an astonishing 40.7% rise year-on-year. This, in turn, pushed up its full-year earnings to RM38.4 million.
However, according to its Bursa filing, Yinson’s 4QFY13 net profit of RM4.93 million was 15% lower from the previous corresponding period’s RM5.88 million.
“Yinson’s 4QFY13 net profit dropped 42.1% QoQ and 26.2% YoY due to a net exceptional item loss of RM4.5 million arising from:
(i) a RM8.2 million write-off in trading receivables related to a scrap steel customer facing financial difficulty and is unable to settle the debts in full,
(ii) RM3.1 million gain from the revaluation of its 40% stake in Phu My port (up RM3.1 million) and
(iii) RM600,000 disposal gains of equipment,” explained Chong in his note today.
Despite these losses, the firm’s FY13 net profit was still higher year-on-year at RM33.98 million. In FY12, it made RM26.57 million.
“In the long run, we are positive on the company as its growth trajectory is accelerating. The company is looking to kick start its FSO operations in early FY14 and FPSO operations in FY15. Its strong links to Petrovietnam Technical Services Corporation are a precursor to more Vietnamese opportunities,” See said on Yinson’s prospects.