MARKET DEVELOPMENT
Kenanga Maintains Sime Darby\'s FY13- FY14 Net Profit Forecast
Kenanga Maintains Sime Darby\'s FY13- FY14 Net Profit Forecast
15/04/2013 (Bernama) - Kenanga Research has maintained Sime Darby Bhd's financial year 2013-financial year 2014 core net profit forecast of RM3.02 billion-RM3.55 billion despite plantation earning concerns due to weak crude palm oil (CPO) prices.
Kenanga in a note Monday said CPO prices in the first quarter of 2013 have been weak at an average of RM2,324 per tonne and the company would likely miss its key performance index target for plantation business earnings of RM3.2 billion, which is based on an average CPO price of RM2,700 per tonne.
"We are only expecting a financial year 2013 core net profit forecast of RM3.05 billion, which is in line with our assumption of an average CPO price of RM2,500 per tonne for calendar year 2013," it said.
The research firm is positive on the acquisition of Weifang Wei Gang Dredging Project Co Ltd and Weifang Wei Gang Tugboat Services Co Ltd, saying the deal would strengthen Sime Darby's China utilities division's income in the long term.
Sime Darby recently acquired the remaining 51 per cent stake in Weifang Wei Gang Dredging Project and Weifang Wei Gang Tugboat Services for a cash consideration of RM18.1 million and RM7.5 million respectively.
Kenanga in a note Monday said CPO prices in the first quarter of 2013 have been weak at an average of RM2,324 per tonne and the company would likely miss its key performance index target for plantation business earnings of RM3.2 billion, which is based on an average CPO price of RM2,700 per tonne.
"We are only expecting a financial year 2013 core net profit forecast of RM3.05 billion, which is in line with our assumption of an average CPO price of RM2,500 per tonne for calendar year 2013," it said.
The research firm is positive on the acquisition of Weifang Wei Gang Dredging Project Co Ltd and Weifang Wei Gang Tugboat Services Co Ltd, saying the deal would strengthen Sime Darby's China utilities division's income in the long term.
Sime Darby recently acquired the remaining 51 per cent stake in Weifang Wei Gang Dredging Project and Weifang Wei Gang Tugboat Services for a cash consideration of RM18.1 million and RM7.5 million respectively.