Company Notes 2018.01.12

AirAsia Group may relist M’sian ops to unlock value

“There is nothing to prevent us from listing some shareholdings in AirAsia Bhd [in the future]. What we are creating now is a vehicle (AAG) where some people may want [exposure to] the Malaysian risk or some people may want [exposure to] the group’s risk.”

“That (listing Malaysia AirAsia) is a potential plan. Ideally, we really want to convert all the interest [in all subsidiaries and associates] into one economic unit. So, let’s assume 51% of foreign associate shares could be swapped for AirAsia Group shares and that requires a lot of work such as legal [requirements], but now we have a vehicle to start working towards that.”

“This is also to enable our investors to understand the group better going forward. We hope to consolidate all of Asean’s businesses very soon, [with] Thailand being the next, hopefully, and then we will also give investors individual profit and loss statements, so that they can look at them. This is the first step of combining AirAsia into one economic unit [towards] our dream of creating a single public holding company, and aligning all shareholders.”

Note that Thai AirAsia Co Ltd is 55%-owned by Stock Exchange of Thailand-listed Asia Aviation PCL (AAV). AirAsia Bhd has an effective interest of 45% in Thai AirAsia and 49% in Indonesia AirAsia (IAA). Plans are in the works to list 39.9%-owned AirAsia Philippines Inc this year.


CIMB cuts stake in asset management firms

The group announced yesterday that it had entered into sale and purchase agreements to divest a 20% stake in CIMB-Principal Asset Management Bhd (CPAM) to Principal International (Asia) Ltd (PIA) and a 10% stake in CIMB-Principal Islamic Asset Management Sdn Bhd (CPIAM) to Principal Financial Services Inc (PFI).

“CIMB is expected to recognise a gain on disposal of about RM950mil and a Common Equity Tier 1 (CET1) ratio improvement of about 18 basis points upon completion of the proposed divestment,” it said in a filing with Bursa Malaysia. The group’s CET1 ratio stood at 120% as of Sept 30, 2017.


Ta Ann to buy 30.39% stake in SPB for RM170mil

“The proposed acquisition is consistent with the company’s plan to further expand its oil palm plantation business and gain larger market access in Sarawak,” Ta Ann said.

Ta Ann said its planted area would likely be enlarged by about 23%, given the group’s 30.39% stake in SPB.


Malaysia airports hit record 96.54 million in 2017, driven by international traffic

For the entire year of 2017, passenger traffic at the 39 airports in Malaysia improved 8.5% to a record 96.54 million from 88.98 million in 2016. International passenger movements grew 14.1% to 49.4 million passengers over 2016, while domestic traffic rose 3.2% y-o-y to 47.14 million. MAHB said this is the second highest increase in absolute passenger numbers achieved in the last 20 years.

On prospects, MAHB said Malaysia passenger traffic in 2018 is expected to grow at 6.3%, with international and domestic passenger traffic growing at 8.3% and 4.2% respectively.

“The growing travelling local population, combined with [the] increase in the per capita income, will further support air travel growth,” it said, adding that passenger growth prospects for SGIA in 2018 is expected to remain moderate.


SCGM sales strong on demand for ‘lifestyle’ packaging

Having invested RM153 million in the two new factories, Lee said he is confident the group’s output would steadily increase, allowing SCGM to cater to export markets, which the group wants to place more focus on. The group’s revenue is currently contributed by a 70:30 ratio from the domestic and export markets respectively. Moving forward, as it taps into new markets, the group intends to shift the ratio to 60:40, said Lee.

“This sort of demand for pre-cooked or frozen food is still very new in Malaysia. It’s not something that people are familiar with. If you look at Family Mart today, many of its customers are Caucasians, foreigners or tourists rather than locals. They are already accustomed to the novelty of microwaveable food or ready-to-eat food sold at stores such as this. “We believe, moving forward, the demanding lifestyle and commitment of the middle-aged population will gear towards this trend rather than cooking at home. If you look at Hong Kong, it has a 70% takeaway rate. Singapore is about at a 30%-40% rate,” said Lee.


KUB still seeking buyer for A&W Malaysia

KUB is currently in an extended franchise agreement with A Great American Brand until June 2019. Under the agreement, KUB is obliged to open 25 new A&W restaurants in three years, which will bring the total number of A&W restaurants in Malaysia to 52 by the end of 2019. Although KUB is committed to honouring the contract, Abdul Rahim said it is on a capital rationalisation phase as it embarks on a strategic plan to refocus its business activities on three core sectors, namely energy, information and communications technology (ICT), and agro.

“We don’t want to end up like in Thailand where we lost the franchise licence [to operate A&W restaurants there]. It’s better to sell it when we still have the rights so that the buyer can consider that in their [offer] price,” he said.


Mydin puts Sam’s Groceria stores up for sale

Ameer estimated the grocery business to be worth RM50 million. The planned sale comes on the heels of the disposal of its loss-making MyMydin convenience store business in April last year. It also discontinued the Kedai Rakyat 1Malaysia (KR1M) stores in October 2017. “We decided to sell Sam’s Groceria after realising that the stores’ patrons are mainly local Chinese and expatriates. (However,) we do not sell liquor, wine, beer or pork at our stores and thus, we have been unable to meet our customers’ needs,” he told The Edge Financial Daily.

Ameer said currently, Mydin Holdings has 62 stores under its portfolio excluding Sam’s Groceria. According to Mydin Holdings’ website, Sam’s Groceria is positioned as a premier urban grocer and 60% of its products are fully imported brands. It opened its first flagship store in Gurney Paragon Mall in 2013.

A check with the Companies Commission of Malaysia revealed that Sam’s Groceria Sdn Bhd is also loss-making. It posted a net loss of RM27.49 million on revenue of RM63.16 million in FY16. Accumulated losses stood at RM42.05 million as at March 31, 2016. Sam’s Groceria also has RM101.8 million in total liabilities, of which RM84.54 million are current.

Company Notes 2017.12.01

GHL Systems Q3 FY2017 Results

The Group has successfully deployed since 2015, its TPA merchant acquiring tie-ups with CIMB (physical merchants) and Global Payments (online and physical merchants) and in 2016, additional tie-ups with Alipay (Thailand) and RCBC group (Philippines). GHL group has commenced merchant acquiring for Alipay in Malaysia in 2Q17 and AFPI (Beep card) in Philippines for merchant acquiring in expected in 4Q17. The group remains optimistic of further developing TPA as a key growth engine for the group given the changes in the payment landscape as e-payments gain further traction as driven by not only regulatory directives but also positive changes in consumer preferences towards e-payments.


JHM Consolidated Q3 FY2017 Results

The declined in revenue was mainly due to worldwide components shortage and extended lead times in the supply chain.

The average inventory turnover days has reduced from 53 days to 39 days as a result of the continuing efforts of the Group in improving the inventory turnover efficiently.

Despite of facing the worldwide shortage of raw materials, particularly the passives, the Group’s outlook remains strong and bright with the growing acceptance of LED lamps in automotive market.


Dufu Technology Q3 FY2017 Results

We expect sales to continue to remain favorable towards end of 2017 as our major product is driven by the growth in high-capacity nearline HDDs as well as stabilization of client storage demand. The long-term future of HDDs are likely rests with high capacity HDDs, particularly in data centers serving cloud storage applications. The demand for high capacity storage drives, enhanced performance, and lower storage cost is set to rise. Global internet penetration, the rise in e-commerce in emerging markets, and the current trend for high-resolution media standards are the likely drivers for the continuing rise in global data storage demand.


Perak Transit Q3 FY2017 Results

The outlook of integrated public transportation terminal operations segment is expected to the favourable driven by the Group’s plans for expansion in other part of Perak, whereby the construction of the Terminal Kampar has commenced and it is on schedule. It is expected to be completed by 4th quarter of 2018. In addition to Terminal Kampar, the Group’s plans include similar integrated public transportation terminal in Bidor and Tronoh. As of this juncture, the Group is unable to determine the construction cost for the terminals to be built as the construction project is still at its preliminary stage and the approvals for construction have yet to be obtained from the relevant authorities. In this regards to the status of the Bidor and Tronoh lands, the acquisition of the lands are pending completion subject
to the fulfilment of the condition precedent as announced on 19 January 2017 (Bidor), 18 September 2017 (Bidor), 28 March 2017 (Tronoh) and 27 November 2017 (Tronoh) respectively.

The Group’s bus operations segments outlook is also positive driven by Stage Bus Service Transformation programme as the operation runs all the 19 approved routes since September 2016 with 45 express buses fully delivered in March 2017.


Pos Malaysia Q2 FY2018 Results

The Group’s prospects remain positive as our business continues to be largely driven by the strong e-Commerce growth in Malaysia and we are optimistic that the establishment of the Digital Free Trade Zone (DFTZ) will drive cross-border e-Commerce volume, especially for Malaysian small and medium enterprises (SMEs). This is expected to be positive for the prospects of our e-Commerce related businesses, namely our courier, eFulfilment, air cargo logistics and international mail business.

On the digital front, we are looking to introduce digital services that are relevant to our customers as digitalisation and demographic changes have encouraged us to be more innovative in providing services that suit the changing lifestyle needs of the Malaysian public, especially the younger generation. Accordingly, we expect to launch our Digital Mailbox product in early 2018 that will provide a range of digital services catering to mobile lifestyles. We are confident that our Digital Mailbox will, over time, become a key digital product offering.


EG Industries Q1 FY2018 Results

The Group is in the midst of construction of the IPC hub and expects to begin its IPC operations in December 2017. With the commencement of IPC operations, the Group is expected to obtain more competitive raw material prices through larger scale of procurement activities to maintain its competitiveness in global Electronic Manufacturing Services (“EMS”) market.


CAB Cakaran Q4 FY2017 Results

The integrated poultry farming and processing division’s performance in the next quarter may be moderately affected by the lower average selling price of broilers but will be mitigated by the lower cost of feeds. The recent strengthening of the Malaysian Ringgit and the world wide over supply of corn and soya, has contributed to the lower cost of feeds.

The value added food products manufacturing and trading division’s performance will be impacted by the continuous losses at Farm’s Best Food Industries Sdn. Bhd.. Management expects the performance of this division to show improvement after the measure undertaken to improve operational efficiency as well as the upgrading of facilities are completed over the next few months.


Ta Ann Q3 FY2017 Results

Performance for the palm oil sector is expected to remain as the main profit contributor in the coming quarter. For timber sector, the underperformance is due to the low logs production in compliance with the certification exercise as well as the restricting logs export quota of 20% that took effect in July 2017.

Given to the low plywood inventory in Japan coupled with the infrastructure construction works for the coming Olympics which has accepted the Company plywood products for the said construction works, we expect the timber market to rebound.


OCK Group Q3 FY2017 Results

The Group aims to grow its recurring revenue business via build-own-and-lease and acquiring existing tower sites operators in ASEAN. For our tower leasing business expansion, the Group is leveraging on its established presence in ASEAN and its vast experiences in building telecommunication infrastructures and site maintenance of telecommunication infrastructure. The build-own-and-lease business model is based on building, owning and leasing back the tower sites to telecommunication operators over a long-term period.


Notion Vtec Q4 FY2017 Results

The auto braking plungers business is expected to have a double-digit growth in FY2018 especially in electric and hybrid cars. The production for the lifestyle consumer electronics segment will take to production as soon as possible as it is a high volume product. We have also made inroads to a major MNC production equipment maker in the semi-conductor space which has good prospects. The Group continues to invest in new technologies and diversifying its customer and industry bases.

Finally, due to the need to conserve cash in the light of the fire incident the Board has decided to defer any dividend payment for this and next quarter until things are back to normal.


IQ Group Q2 FY2018 Results

The Group’s first half year performance has been below expectations. Sales slowed during this period and performance was further impacted by some delays in the conclusion of new product sales. IQ is however blessed with considerable opportunity from both new and established business relations with on-going product development and related planned launches in the pipeline. The current volume of product development requirements is good from a new business perspective, but challenging from a resource and timing standpoint. We see that the current conditions will remain throughout the remainder of this financial year, but going forward thereafter we anticipate positive performance as the various new products are rolled out into the market. Improvements to IQ’s R&D structure are already implemented to accelerate results and to better position our speed to opportunity going forward.

Paper mill operations to boost BHS Industries’ earnings

As it stands BHS earlier this month signed a memorandum of understanding with China Nuclear Industry Huaxing Construction Co Ltd to jointly develop the second and third phases of the project. Phase 2 involves a factory with the capacity to produce 100,000 tonnes of box liner paper as well as 120,000 tonnes of corrugated paper. Meanwhile, Phase 3 will involve another factory with a capacity to produce 65,000 tonnes of tissue paper. Interestingly, Lim added that, “We are targeting to give the award on the final negotiation to the Chinese party for the main building of the factory (Phase 1 for 10,000 tonnes wood-free pulp and paper plant).”

Note that BHS has secured a five-year contract from the Malaysian government to publish past examination papers. It also disposed of a plot of land (from the 410-acre GTP project) for RM5.3 million to a third party to develop. The group is still looking for potential partners to jointly develop the project’s fourth and fifth phases. Phase 4 will involve the construction and development of a feed mill with production capacity of 30,000 tonnes of agro-feed using the microbial fermentation technology, as well as a fertiliser plant with a production capacity of 50,000 tonnes of fertiliser using the by-products produced from the biogas plant.

Phase 5 has been earmarked for light industries involving the construction and development of packaging and printing factories. Additionally, BHS is also looking to expand the GTP model to other states. The group signed a memorandum of understanding with Sarawak Land Consolidation and Rehabilitation Authority subsidiary Bau Palm Oil Mill Sdn Bhd (Bapom) on Nov 10 to jointly develop, implement and finance a waste management project to convert the palm oil biomass, which is supplied by Bapom into commercially viable products. On top of that, BHS is actively looking to develop a third GTP in Johor in the near future; a first step before spinning off the concept to other states as well. “We are targeting Johor as there are many palm oil mills over there,” explained Lim, adding that in the next four years the group could be looking at Indonesia for expansion as well.”

Printing and publishing remain the core business of the group, accounting for about 80% of its revenue in FY17. The remaining 20% came from park development and management activities. “[Revenue] contribution is mainly from our book printing and publishing [business] now, but you will soon see it overtaken by GTP Phase 1,” said Lim. He expects the revenue contributions to invert, with 80% of the revenue coming from GTP Pekan and 20% from the existing printing and publishing business.


Top Glove wants to buy Aspion for RM1.3bil to boost profits

Aspion is currently the second-largest producer of surgical gloves in the world, with an annual production of 1.4 billion pieces or an 18% market share. Lim said production at Aspion is projected to increase by another 1.6 billion pieces by 2019 due to the ongoing capacity expansion at its Kulim plant in Kedah. Top Glove has a 12% global market share in this segment, producing 665 million pieces a year. The surgical glove segment, prior to the acquisition, contributed about 5% of Top Glove’s revenue.

Aspion’s Kulim plant houses the company’s most recent technology and research and development centre. It also has manufacturing facilities in Kluang, Johor and Kota Bahru, Kelantan, catering mainly for examination gloves. Aspion owns cutting-edge technology, namely, its Finessis surgical glove which is known to be the only technology capable of reducing the number of viruses (such as HIV) transferred in cases of percutaneous injury.


EG Industries allocates RM30mil for plant expansion

Group chief executive officer and executive director Alex Kang said the expansion, to be funded through bank borrowings and internally generated funds, was to cater to the strong enquiries from customers for box-build contracts, reiterating the company’s stronger proposition in this segment.

“Not only has our box-build segment improved, but also our printed circuit board assembly (PCBA) segment as it remains the main revenue generator for EG Industries.”


Kim Teck Cheong Consolidated to realise its investments in FY19

In March, KTC acquired a 60% equity interest in Grandtop Marketing Sdn Bhd for B$600,000, which is principally engaged in the business of distribution of CPG in Brunei. He said the group plans to further invest in its infrastructure in FY18 — albeit with a smaller allocation — to take advantage of opportunities as they arise. He added that KTC is currently in talks with five to six notable third-party CPG brands in Sabah and Sarawak, which may come on stream in FY18.


Freight Management sees 10% growth in FY18 profit

“There is no such thing as saturation in the market as there are no more avenues to grow. There will always be customers who are looking for improvements in service. We just have to take advantage of our strength to gain market share.”

The sea freight segment will remain the group’s core business. “We have always been very strong in our sea freight segment, so it’s only natural that we try to keep building and growing this particular segment.”

On the group’s e-commerce segment under 65%-owned FM Hubwire Sdn Bhd, Chew said although there is an opportunity to grow, the loss-making business remains a challenge as it is a relatively new area for the group. “We started this about a year ago, but honestly the business has not really gained traction. We are exploring ways to boost the business. Although it may take a while, if we don’t get involved now it will be too late later. It is a challenge now, but we have the resources [to sustain it],” he said. The group, he added, hopes to see some traction in the business by end-FY18, and to turn a profit by FY19.

Company Notes 2017.10.27

British American Tobacco Q3 FY2017 Results

The Group registered market share decline from 54.5% in the second quarter of 2017 to 53.9% in the third quarter of 2017. Dunhill, the biggest Premium brand in legal market, registered 38.4% market share in the third quarter of 2017 (-0.6% versus previous quarter). The decline is mainly due to the prevailing high level of illegal cigarette incidence at 56.1% as of August 2017 (Source: Consumer Track by Kantar Research Agency) as well as the growth of a lower price segment within the legal market.

In relation to the cessation of the manufacturing operations announced on 17th March 2016, the Group has further recorded a one-off restructuring expenses of RM7.9 million as of year to date September of 2017 which consisted of on-going cost of the project, outplacement programs and one off expenses associated with the storage and transfer of unprocessed leaf and raw materials.

 

Maxis Q3 FY2017 Results

Demand for data continued to grow with 6.0 million 4G LTE users (3Q16: 4.1 million) and an average usage of 7.4GB per month (3Q16: 4.4GB). This was supported by the increase in smart-phone penetration which stood at 80.3% against 73.7% on a blended basis. The Group continued to lead the market with its expanded 4G LTE network at 89% population coverage, enabling customers to enjoy high speed and unmatched digital experience. In addition, the Group recorded an all-time high touch point net promoter score of +52 in the current quarter compared to +41 in Q3 2016.

 

Bursa Malaysia Q3 FY2017 Results

Bursa Malaysia-i , as the world’s first fully integrated end-to-end Shariah-compliant investing platform, will continue to intensify its efforts to promote Shariah investing in the market. Meanwhile, trading activities in Bursa Suq Al-Sila’ (“BSAS”) continues to record improvements. Bursa Malaysia will continue with its efforts to expand BSAS reach in new regions such as North Africa and Central Asia.

Bursa Malaysia recorded a significant milestone with the launch of the Leading Entrepreneur Accelerator Platform (“LEAP”) Market in July to assist small and medium enterprises (“SMEs”) to raise funds from the capital market for their business expansion. The LEAP Market went live on 3 October with the successful listing of Cloudaron Group Berhad.


Gadang Holdings Q1 FY2018 Results

On-going projects i.e. RAPID package 301 and 402, KVMRT V206 and TRX are executed on a fast track basis to optimise on cost saving and design effectiveness. With the latest award of Cyberjaya Hospital in August 2017, the outstanding order book of the Division has increased to RM1.98 billion.


Public Bank Q3 FY2017 Results

The Group’s Common Equity Tier I capital ratio, Tier I capital ratio and total capital ratio stood at a healthy level of 11.7%, 12.4% and 15.4%. The Group’s liquidity position also remained stable and healthy with Loan to Fund ratio standing at 88.6% as at 30 September 2017.

Tan Sri Teh said, “The Public Bank Group has always focused on asset quality in the pursuit of business growth. Thus, the Group has been able to sustain its stable asset quality even in challenging times. As at the end of September 2017, the Group’s gross impaired loan ratio of 0.5% continued to remain the best in the domestic banking industry.”


Lotte Chemical Titan Q3 FY2017 Results

Overall market started off moderately in Q3 2017 after the Hari Raya holidays. Market demand rebounded by late July following the Chinese government’s announcement to ban importation of plastic scrap by end of 2017. The capacities taken offline caused by Hurricane Harvey in United States had temporarily affected supply from United States, especially to Latin America. The market was briefly lifted up as concern on the supply disruption from US lingered. Meanwhile, supply from other regions was reportedly diverted to Latin America to fill the void.

Group plant utilization was lower at average 77% compared to average 92% in corresponding quarter. This was mainly due to statutory routine turnaround (every 5-6 years) for Cracker 1 plant in Malaysia and Indonesia polyethylene plants load was reduced during the quarter due to poor polyethylene economics as a result of tight ethylene supply and high cost.


Texchem Resources Q3 FY2017

The revenue recorded for YTD Q3 2017 was RM192.2 million against RM164.3 million in YTD Q3 2016. The Restaurant division incurred pre-tax loss of RM1.6 million against pre-tax profit of RM4.3 million in YTD Q3 2016 mainly due to closure costs of RM5.2 million arising from cessation of business by a subsidiary and losses from new concept restaurants.


Suiwah Q1 FY2018 Results

The Manufacturing division experiences high prospect projects entering commercialization stage during the past few months. The Group foresees continuous growth in the flexible electronics sphere. The new expansion project at Batu Kawan has also taken off and the rate of construction work is progressing in accordance with the milestone target. The Group will continue its mission to create and add values to all customers, employees, and shareholders by delivering innovative, competitive and quality interconnect technology solutions.


WZ Satu Q4 FY2017 Results

For civil engineering and construction segment, the Group not only accumulated an order book to last for the next two to three years but also the Group is confident that its order book will grow beyond the run-off rate. The outlook of this sector is promising with the Group benefiting from Government expenditure in infrastructure.

Full restoration of plant may take up to 1 year, says Notion VTec (filing to Bursa Malaysia)

It has affected more than 552 Computer Numeric Control (“CNC”) machines and Work-in-Progress (“WIP”) goods and the Quality Control “QC” building but not the rear building and the surface treatment plants are good and operational.

Notion has adequate insurance coverage – RM350 million for property damage, RM217 million for business interruption up to 18 months. The preliminary estimate of the loss is about RM150 to 200 million. Once we gain access to the site we shall be able to assess the extent of damage and provide a more accurate estimate of loss.

At this moment, the Company estimates the affected segments are the camera, Hard Disc Drive top clamps and automotive parts but the Company will re-commence production in Factory 3 using any spare capacity that Notion has as well as sourcing and renting suitable CNCs and if needed, rent additional floor space to meet current and new customers’ requirements. It is not easy to outsource to other machinist companies as it requires safety certification and approved vendor which will take time. Notion is committed to restoring the orders to the customers’ requirement.

The immediate effects of this outage in this affected Plant are about 50 to 60% of the Company sales revenue but with the fast recovery plan, Notion will have restored 75% of the outage progressively within 5 months and the balance within another 3 months. But of course, the full restoration of structure and Certificate of Fitness may take up to a year.

 

Comintel to give special cash dividend after sale of subsidiary (filing to Bursa Malaysia)

The buyer is Aurelius Holdings Sdn Bhd, a newly incorporated investment holding company, where Comintel executive director Loh Hock Chiang is also a shareholder of Aurelius. As at 29 August 2017, Loh holds direct interest of 0.07% in Comintel. Comintel’s CEO of Comintel’s manufacturing segment Lee Chong Yeow is also a shareholder of Aurelius.

Comintel said the proposed disposal will give the company the opportunity to unlock and realise the value of its investments in BCM Electronics. BCM, which is involved in electronics manufacturing services, provides turnkey manufacturing services. Comintel said “there is limited leverage to further increase the competitive edge of the electronics manufacturing services (EMS) and EMS-related industries.” If Comintel is unable to continue to maintain the competitiveness of the EMS business, there could be adverse impact of potentially losing its key customers to its competitor’s, the filing said.


Thriving Top Glove believes growth is sustainable

“We are very fortunate to operate in a growing industry. Not only demand for medical gloves is growing but even the food industry, such as in the restaurants and supermarkets, is using a lot of gloves, especially disposable gloves. Demand is growing, so growth is definitely sustainable. To grow by 10% a year in any industry is very good and we have been growing for the past 30 years.”

“Margins over the past 15 years is about the same, which is about 10% for net profit margins. I think these margins are reasonable. Profit margins, which are too high at 30%-40% in the manufacturing industry, won’t last. You will invite competition when your margins are too high. Margins which are too low will affect the industry as it cannot grow well. I think net profit margins at the 10% level is sustainable and will likely continue for the next 10 to 20 years.”

“On average, our revenue per worker per year is about RM250,000. This figure is better than an electronics factory, which is about RM200,000. Some 10 years ago, we were only at RM150,000. So we have improved a lot, much more than an electronics factory.”

Surgical gloves are thicker than the normal gloves due to requirements during surgery. It also requires more raw materials per piece to manufacture. Top Glove presently only produces 2% of surgical gloves compared to its total product mix by sales quantity. “It is certainly good to consider expansion in terms of acquisition for surgical gloves. We are No. 1 in terms of examination gloves and rubber gloves that is exported from Malaysia. When it comes to surgical gloves, we are at No. 4 or 5. It is also in our plans to tap into the growing market of surgical gloves.”


This little known Malaysian stock has surged 400%

“The margins are beautiful,” Yap, 61, said in an interview at the company’s headquarters on the outskirts of Kuala Lumpur, referring to the Manno tie-up. Clients in those sectors are willing to pay more for quality machined parts, such as shoulder screws used to secure protective casings for sensitive equipment, he said.

The company, which supplies its mold-cleaning rubber sheets to about 70 percent of Malaysia’s chipmakers, is expanding into markets like Taiwan and China after winning clients including Chinese chip-testing company Tianshui Huatian Technology Co. “There’s a reason why we control the market here, and Tianshui as a client is a testimony to our capabilities,” Yap said. The manufacturing process may seem simple, but “it’s difficult to replicate,” he said, adding that there’s plenty of room to expand in those countries: while they require about 180 tonnes of rubber-cleaning sheets per month, Techfast currently only supplies about 12 tonnes.

Still, for Yap, the share-price surge is just the start. He says he plans to return 40 percent of the company’s net income to shareholders starting this financial year, up from 26 percent in 2016. The “big leap” in profit will be in 2018, he said.


Favelle Favco’s next phase of growth

Although the decline in oil prices for the past three years has not deterred the company’s growth, Favelle’s orderbook replenishment is slowing down. This is because more than 60% of its business is in the offshore oil and gas (O&G) cranes. As such, diversification has been part of the company’s plan. Presently, it has an orderbook of RM536mil, halved from its orderbook in 2014 of RM1.02bil. Earnings wise, the company saw its net profit grew marginally to RM32.3mil in the first half ended June 30, 2017, from RM31.3mil a year ago.

Favelle says it has inked a heads of agreement to acquire 70% stake each in Exact Automation Sdn Bhd, Sedia Teguh Sdn Bhd, Exact Analytical Sdn Bhd and Exact Oil & Gas Sdn Bhd. These companies are primarily involved in the provision of engineering services, industrial automation solutions, and specialised equipment mainly for the O&G industry.

It is worth noting that Favelle has about 40 years experience in the crane business. With the O&G sector starting to gain traction as crude oil prices continue to stabilise, it is timely for Favelle to embark on its next phase of growth.


Higher capacity boost for Hartalega

The world’s largest nitrile glove maker, which has been enjoying an average year-on-year revenue growth of 28% for the last 13 years, has attributed the stronger growth to the expansion of its production capacity.

At an investment of RM2.2bil, the NGC will comprise six state-of-the-art manufacturing plants housing 72 of the most technologically advanced production lines in the industry. Upon completion, the NGC will see Hartalega’s total installed capacity increase substantially to 42 billion pieces per annum from the current 29 billion pieces. Over the next five years, Hartalega aims to have an average growth of 15% per annum in terms of manufacturing output via capacity expansion.

On the likelihood of diversification to rubber products, he said the company would not undertake such an exercise. “We don’t plan to diversify. This is because our profit margin is double than the industry average. Furthermore, we have the competitive advantage in terms of strength and there is good potential for future growth in the glove business.”


Caring to launch digital platform

“We want to streamline all our channels, from our [present] bricks and mortar stores and e-commerce store to a website and mobile app, for our customers’ convenience in enjoying a seamless shopping experience. Customers can order products and have them delivered to their doorstep, or if they want to save on courier charges, they can order online from home and pick up their products from our outlets three days after.”

As of Aug 31, 2017, the group operated a total of 110 pharmacies, Chong said, adding that it plans to open 10 to 12 new outlets a year.

“We are conducting surveys and studies on locations in the east coast of Peninsular Malaysia, Sabah and Sarawak to prepare for our expansion there. Last month, we opened [a branch] in Kuantan and in December, we will open a branch in Kota Baru. We have identified a site in Sabah where we plan to open [an outlet], hopefully in six months. [Our aim] is to be a complete national player,” said Chong.


Nationwide Express sees Airpak buy as growth catalyst

The acquisition of Airpak, Rosilawati said, fits in with the group’s strategy of expanding its business-to-consumer (B2C) or consumer-to-consumer segments, which currently account for just 5% of Nationwide’s revenue. The bulk of its revenue is derived from serving business-to-business (B2B) customers.

While Airpak’s courier business is seen as complementary to Nationwide’s existing operations, the acquisition of MTR is geared towards the group’s diversification, expansion, and long-term sustainability, she said.


MAHB on connectivity goal

“By having Alibaba here, the programme would help startup to establish e-commerce and transaction and payment. When you have access to global market, the growth rate of e-commerce would be in a single-digit but once the ecosystem is implemented, it will quickly jump into high double-digit.”

“Commercial airlines have the opportunity to carry e-commerce cargo, which in turn would boost airlines profitability and good for the airport. Thus, airlines would also look at other opportunities to either same or introduce new destinations.”

“The aviation industry is about inbound foreign direct investments. For example Boeing and Airbus will save 40 per cent of their new aircraft deliveries over the next 10 years in Asia. Aircraft manufacturers need to move a lot of those activities in Asia to serve their customers. They need to open up more MRO centres.”


ES Ceramics seeks new revenue streams

“We want to further diversify our portfolio to include complementary new products within the dipping industry. It does not help that key glove makers have been expanding so aggressively over the years. There is a price competition because some players are hungry. Why? Maybe they have increased capacity, but utilisation has not caught up.”

On its part, ES Ceramics has diversified from producing moulds for different glove types — examination, household, industrial and specialty — to include breathing bags and balloons as well. Wong did not reveal the latest products that ES Ceramics is looking to include in its list, noting that discussion is still at its infancy stage.

“We do not have the advantage of some manufacturers who can purchase turnkey machinery [to adopt automation]. Our machinery needs to be modified and tested. For that, we need engineers. But some engineers are from fields that are relevant to our operations, and some are inexperienced. We have been hiring and firing, that has caused our staff costs to increase slightly, but that will stabilise when the right team is established to speed up the adoption.”

“Right now, our factories are not applying automation at a significant level,” said Wong. The group is currently focusing on less critical parts of the manufacturing line to allow for more room for modifications. “The first objective is to make sure automation can work before it is being applied across the board. Only then can we look at improving quality,” he said, without giving a timeline for the adoption to be meaningful to ES Ceramics’ financial performance.


Perodua has no plan to introduce EVs in Malaysia yet

Daihatsu holds a 20% stake in Perodua and is also the latter’s technology and technical partner.

“I would rather we focus on our bread-and-butter internal combustion engine (ICE), which is energy efficient and can still be used in Malaysia. What we’re doing now is looking at how we can realise the full potential of this engine in terms of fuel consumption. Until such time we cannot improve on it anymore — that is, once it already reaches its full potential — then only we’ll consider EVs.” Zainal said it does not make sense for Perodua to venture into EVs now as the infrastructure that is needed to support such technology, such as charging stations, is not yet widely available in Malaysia.

He explained that the government’s policy on EVs is two pronged — to try to bring down the cost of EV production by allowing lithium-iron batteries to be produced in Malaysia, and to install more charging stations nationwide. He said there are currently 230 charging stations being installed and it is expected that by 2020, there will be 1,000 stations.


Pensonic eyes IoT market

“We have not committed ourselves to a time frame for the IoT project. But we can safely say that we are committed to the project, which is now part of five-year business strategy. The Malaysia IoT Consortium (MyIoTC) is looking into creating an IoT ecosystem so that it could better tap into the IoT business opportunities worldwide, leveraging on the members’ respective strengths and area of specialisation.”

On the local front, Weng Khak said the company has been granted nationwide MYTV set-top box (decoder) distributorship in anticipation of Malaysian television broadcasting going digital in 2018. “The decoders would be a required item to receive television signals for continued access to Free-to-Air TV channels. The management is of the view that this distributorship would contribute to the group’s revenue in the short to medium term.”


Top Glove’s Lim buys 10.24% of Tropicana

The transaction price was not disclosed in the filing with the stock exchange. Based on yesterday’s closing of 93 sen, Lim’s 10.24% stake will cost him RM139.6 million.

“Over the years, Tropicana has proven itself by delivering high-quality and iconic projects to its customers. With my business experience, and regional as well as international contacts, I hope to contribute positively in moving Tropicana up the value chain.”


TMC to expand bed capacity to 1,100 in five years

“We are hoping to achieve this target if, and only if, we manage to complete the expansion of our capacity at Tropicana Medical Centre, as well as get the health ministry’s go-ahead to kick-start the Iskandariah Hospital in Johor. Most importantly for us is to expand our current facilities first, as we bank on the growing local population and increasing demand for medical services. Gradually, I am hoping the facility in Kota Damansara will reach to 600 beds by 2020.”

The construction of the additional facilities on a six-acre (2.43ha) land in Kota Damansara, serving a neighbouring population expected to increase soon to 200,000, will take three years to complete and cost around RM300 million. The centre’s overall weekly utilisation rate is 60%.

“We are also planning to open a fertility centre in East Malaysia. Hopefully, this will garner more interests from the locals and tourists. We recently celebrated the delivery of the 1,000th baby born via the in-vitro method. Obviously, this business is doing well.”


TNB’s net profit could fall by RM1b p.a. if 2% tariff mark-up removed, says CIMB Research

Under the IBR framework RP1 (2014-2017), TNB’s return on its transmission and distribution (T&D) assets is 7.5%, said CIMB Investment Bank Bhd in a note to clients today. However, its actual average tariff is about 2% higher than the base tariff set by the IBR due to higher electricity consumption by the commercial sector.

“As such, when the regulator revises the IBR parameters for RP2 starting in 2018, the allowable return may be lowered and we see potential earnings risk as it may no longer enjoy the additional 2% tariff,” said its analyst Ngo Siew Teng.

“Assuming TNB is only allowed to earn a 6.5% return (its weighted average cost of capital based on CIMB estimates) on its T&D assets and the 2% mark-up in tariff is entirely removed, we estimate that TNB’s net profit could be lowered by as much as RM1 billion per annum. This, plus the risk of a higher effective tax rate, may lead to a RM2 billion reduction in TNB’s annual net profit,” she added.


Plywood prices on uptrend

“Delay of shipments is about three to four months now, and port inventories are down in Japan while the demand continues to be strong. Plywood mills operate with very little log inventories. Also quality logs are hard to come by now,” revealed International Tropical Timber Organisation (ITTO) report in its latest issue. Reduced supply volume and higher export prices will continue.

“Floor base plywood demand has been shifting to domestic softwood plywood. Demand for softwood plywood is brisk mainly by large precutting plants. August softwood plywood production was high at 254,700 cu m, 10.8% more than August last year. It is a fact that domestic plywood is now more than imported plywood in Japan but imported plywood is absolutely a necessary product for Japan. But in the coming years, the (Japanese) market would not accept any product without traceability of forest certificate.”

“In Indonesia, 40% of total harvest is now planted timber and in Sarawak, share of planted timber in total harvest will be more than 50% in five years.”

Tax laws must not be complicated

Seah noted that the government had in recent times amended the laws after losing out in court disputes with taxpayers. The CTIM, she added, supports amendments that are made for tax laws to stay relevant to current trends and to maintain their original intent. “However, amendments [made] after the loss of a tax case are often drafted with a very wide scope to cover any imaginable circumstances and they [the amendments] sometimes unintentionally affect other taxpayers and put them in a difficult position,” said Seah.

Seah said policymakers should have guidelines and implementation plans ready to be rolled out immediately after amendments are proposed. Similarly, for all the rulings, Seah opined that the effective date should not be on a retrospective basis.

To avoid hiccups in implementation, communication between different government agencies and policymakers is essential to enable harmonisation of laws whenever there are changes or implementation of new rulings.

Company Notes 2017.08.25 (Part 1)

Malakoff Q2 FY2017 Results

The results for the financial year ending 31 December 2017 will be affected by the lower capacity payment in the new revised Segari Energy Ventures Sdn Bhd’s Power Purchase Agreement commencing 1 July 2017.


Fiamma Q3 FY2017 Results

The new integrated logistics warehouse has improved the operation and cost efficiency of the Group and will also be able to generate a recurring income stream for the Group from the provision of storage space and logistic services to third party customers.


TH Plantations Q2 FY2017 Results

“The recovery in production and replenished stock levels throughout the industry have inevitably cause some downward pressure in CPO and PK prices, and we have seen average prices normalising down from their recent highs. However, we remain optimistic that the prices will still remain supported by increased demand for palm oil products, particularly in view of higher soybean oil prices in the United States.”


APM Automotive Q2 FY2017 Results

… lower demand from OEMs. ..lower revenue and higher operating costs from the newly completed plants overseas.

…profitability will be pressured by higher operating costs from the new overseas operations such as Thailand and Indonesia. These operations will focus on driving sales with an internal emphasis on efficient resource management, cost containment and increased technical training of workers to improve production efficiency.

…level of investment will not be curbed in the face of declining profitability… continue to expand its product range and to diversify geographically its reliance on one market.


Nestle Malaysia Q2 FY2017 Results

Compared to the second quarter of last year, the prices of major raw materials such as milk powders, coffee beans, and palm oil had increased by some margin.

Examples for the successful product launches in H1 2017 are MAGGI Hot Mealz, MILO “KAW”, KIT KAT Mini and MAT KOOL Panda Ice Cream.


Rubberex Q2 FY2017 Results

the provision of unrealized foreign exchange losses on investments held in China and higher costs of production, especially latex and resin, key components of our manufactured products.

The first phase of our nitrile disposable gloves project is currently operating at 80% capacity and is expected to be fully utilized by the second half of the year.

The Group is now embarking on the second phase of expansion with the proposed installation of two production lines that would increase the current installed capacity by another 500 million pieces to 1.5 billion pieces annually, however, commercial production is only expected to commence by the second half of 2018.


Evergreen Fibreboard Q2 FY2017 Results

due to higher log and glue cost…Production volume was reduced as a result of shortage supply of rubber wood and scheduled plants shut down for maintenance during the Ramadan festive period.


Star Media Group Q2 FY2017

On 12 May 2017, the Company announced that Laviani Pte Ltd, a wholly-owned subsidiary company, entered into a conditional share purchase agreement with Lucrum 1 Investment for the proposed disposal of its entire equity interest in Cityneon for a disposal consideration of SGD115,612,731 (equivalent to RM360,179,902) to be satisfied entirely via cash.

With the sale of the two radio stations (Capital FM and Red FM) which were loss-making in the last financial year, Radio segment is expected to contribute positively to the Group.

The Group has recently embarked on its next digital transformation plan with the launch of dimsum.my, its very own video-on-demand service. It offers Asian content and much of it on an exclusive basis. Currently, we are also building its library content to secure a much higher subscribers base.

All TV broadcasting companies globally are facing headwinds and with digital disruption within the media industry, the Company does not expect a turnaround from Li TV. In view thereof, the Board has decided to cease the business operations of Li TV Group to mitigate further losses.


Hock Seng Lee Q2 FY2017 Results

With a record order book of RM3 billion in hand, the Group is now busy on work execution. Nevertheless, the Group will continue to bid for projects that are related to our core business in infrastructure works. Our procurement initiative shall be undertaken in line with our prudent project management strategies, taking due consideration of the capacity and capabilities of the Group. The Sarawak Corridor of Renewable Energy (SCORE) initiative, as well as the forces of industrialization and urbanization, provides further contract opportunities for HSL in the key SCORE growth node towns of Tanjung Manis, Mukah and Samalaju and the major cities of Sarawak. HSL foresees the property development segment, with a variety of products on offer, will make a greater impact on the business of HSL Group in 2017.

“While we are busy executing contracts across the state, we are also experiencing some pressure on margins as demand for materials, labour and sub-contractors has pushed up operating costs.”


Kerjaya Prospek Group Q2 FY2017 Results

The outstanding performance, especially in the construction segment, has mitigated the slowdown in the manufacturing segment which was due to completion of existing projects.

The Group’s outstanding order book stands at RM2.5 billion as at the current financial quarter. In addition, the construction division has secured about RM362 million worth of jobs as at the financial quarter.


Ta Ann Holdings Q2 FY2017 Results

The Group’s log harvesting policy is in compliance with our certification exercise. The reduction of log export quota from 30% to 20% effective 1 st July will channel more proportion of logs harvested to the mills for processing. We have strategically revised our plywood production to processing more products with higher plantation and certified woods components as we are stepping up harvesting of our plantation logs and utilization of imported PEFC certified eucalyptus veneer. To-date, plywood products prices have gone up by USD25/m3 and with higher demand, we anticipate the price uptrend to continue.


Boon Koon Group Q1 FY2018 Results

The prospect of rebuilt commercial vehicles business in Malaysia is expected to remain challenging for the year ahead, with continuing weak consumer sentiment and stringent hire purchase lending rule.

Instead of overdependence on its existing business, the Group via its subsidiary, BKG Development Sdn Bhd, a wholly-owned subsidiary of the Company has proposed to diversify into the property development segment with strong growth prospects with Platinum Eminent Sdn Bhd.


Salutica Q4 FY2017 Results

Bluetooth headsets contributed approximately 94.6% or RM48.9 million of total revenue for the current quarter. Non-Bluetooth products and in-house brand FOBO made up of the balance 5.4% of total revenue for the current quarter.

…due to the deferment of new product launch to the following quarter. This had affected the absorption efficiencies of fixed and variable overheads.

One of the models to be shipped to one of its major customers in the second half of CY2017 will be a new form factor of Bluetooth headsets.

The Group expects the sales of its in-house brand FOBO to grow by increasing the marketing and sales activities through expansion of sales distribution channels and promotional activities. Currently, the Group is marketing FOBO Tire, which is a tire pressure monitoring system for light vehicles, as an OEM after-market accessories to automotive brand owners. FOBO Ultra, which is for heavy vehicles continue to receive encouraging response from commercial vehicles and fleet companies. The Group expects to grow and expand in tandem with the market response.


Pecca Group Q4 FY2017 Results

Revenue from leather car seat covers contributed approximately 73.71% of total revenue followed by leather cut pieces supply which accounted for approximately 18.36% of total revenue during the quarter under review. OEM leather car seat remained the largest contributor segment accounted for approximately 39.94% of the total revenue for leather car seat covers whilst REM and PDI contributed approximately 21.99% and 11.78% respectively.


Classic Scenic Q2 FY2017 Results

…lower export sales revenue from wooden picture frame moulding as the market demand for the wooden picture frame in North America remained flat…The input cost of the Group’s major raw material and timber was fairly stable in the first six months ended 30 June 2017.


Techfast Holdings Q2 FY2017 Results

In order for TPSB to become a one stop center for the military and aerospace business, arrangements had also been made with the said customer as above mentioned to transfer their broaching machines from the USA to the company. As such, these machines will enable customers to source from TPSB as a one-stop center for finished products instead of semi-finished products currently, where further enhancement processes are required.

Cape has dominated the Malaysian market with more than 70% market share of products supplied to most of the semiconductor companies in the country. It has also captured over 40% of the market share in South East Asia. However, the biggest markets for Cape’s products are in China and Taiwan where the monthly market demand for rubber sheets in China and Taiwan is about 150 tons and 30 tons respectively, out of which Cape has about 6% market share.

Oriem, on the other hand, is working on some high end LED and epoxy projects with two reputable international original equipment manufacturers in Penang. Oriem is already an approved vendor which meets the standards and requirements of their supply chain. Our company’s new products are now in the final stages of evaluation by the OEM companies and we expect a business deal to be clinched soon.


Rhone Ma Holdings Q2 FY2017 Results

The Group’s future plans and strategies will focus on the expansion of our manufacturing activities by constructing and operating a new GMP-compliant plant in Nilai, which will increase our production capacity by approximately 4 times of the existing maximum production capacity.

We have commenced work on our new warehouse situated in Kampar on 21 July 2017. The new warehouse, which will be used as our main distribution center to cater to our increasing storage needs for both animal health products and food ingredients, estimated to be completed by 3Q 2018.


Focus Lumber Q2 FY2017 Results

The Group’s production unit cost had surged every month and decreased our profit margin as a result of poor production in the current quarter.

We expect the profit margin of our products to be impacted if the supply of logs issue persists. Currently, management is actively looking for alternative supply of logs, which includes purchasing veneer sheets from local timber companies.


Dagangan NeXchange Q2 FY2017 Results

The Group’s Information Technology business continues to firm up its e-services by broadening its product range in business-to-business segment to complement the Group’s position in delivering business-togovernment services.

The award to supply Portable Container Systems (“PCS”) for petroleum products by Petro Teguh (M) Sdn Bhd, is in line with our plan to pursue opportunistic contracting work in Oil & Gas downstream sector leveraging on OGPC’s expertise in delivering innovative engineered systems in short-cycle projects. This PCS project augurs well with our strategy to expand on the Group’s Energy division and further strengthen this business segment and provide growth moving forward.


E.A. Technique Q2 FY2017 Results

The higher cost of EPCIC was mainly due to additional request for work from the client, of which we will pursue for its recovery in future quarters. The increase in administrative expenses was due to discount on receivables and amortization of goodwill for the acquisition of Libra Perfex Precision Sdn Bhd.

The Group remains optimistic on its operating performance in view of the deployment of FSU Nautica Muar, the chemical tanker and oil tanker in Q3 2017. The overall performance of the Group will depend on the closing of the EPCIC project.


BP Plastics Q2 FY2017 Results

…higher resin costs which the Group was unable to completely pass through to its customers in order to maintain price competitiveness.


UMW Oil & Gas Q2 FY2017 Results

In the second quarter of 2017, five out of the Group’s seven jack-up rigs were income-generating with four of them contributed full-quarter revenue thereby achieving an overall asset utilisation rate of 68%. However, the positive effect from higher asset utilisation was offset by the lower time charter rates as well as zero contribution from Naga 1, a semi-submersible rig, which disposal was completed on 9th May 2017.

While asset utilisation is improving for the second half of 2017, the charter rates continue to remain soft, in line with prevailing market rates.


Ann Joo Resources Q2 FY2017

The Group’s earnings were affected by 1) lower sales tonnage on softer domestic demand which was affected by various factors affecting the construction industry; 2) higher finance cost due to recognition of RCPS unwinding of discount; and 3) recognition of LTIP – share based payments expenses of RM1.06 million.

Global steel supply is expected to be affected by: i. Potential output cuts by Chinese steel mills over winter; and ii. Potential production constraints faced by electric arc furnace operators globally given shortages in graphite electrodes worldwide. This expected demand-supply imbalance should enable the Group to be in an advantageous position as a hybrid Blast Furnace-Electric Arc Furnace (“BF-EAF”) operator with high degree of operational flexibility.


MWE Holdings Q1 FY2018 Results

The construction of both factories in Vietnam (Textile division) and Penang (Telecommunication division) has been completed. New production lines will be gradually increased in our Vietnam factory during this financial year. As for the Penang factory, the production is fully operated after the relocation from the previously rented factory. With the additional new facilities, the management expects the expansion and development of new products will further enhance the future earnings of both divisions.


Plenitude Q4 FY2017 Results

70% of Group’s revenue was from property development and 30% from hotel operations.


IHH Healthcare Q2 FY2017 Results

Parkway Pantai expects revenue to increase with aging demographics, more complex cases undertaken in its home markets and the ramp up of its new hospitals. As Parkway Pantai embarks on its next growth phase, it would focus on markets, such as China and India, where there is robust demand for quality healthcare services.

While the Group expects the pre-operating costs and start-up costs of new operations to partially erode its profitability during the initial stages, the Group seeks to mitigate the effects by ramping up on patient volumes in tandem with phasing in opening of wards at these new facilities in order to achieve optimal operating leverage. The Group expects higher costs of operations arising from wage inflation as a result of increased competition for trained healthcare personnel in its home markets.


Spritzer Q2 FY2017 Results

We will continue with our marketing and sales efforts so as to improve our sales of bottled water in Guangzhou, China and in Malaysia. We will also continue with our market development and brand awareness activities in China. We remain confident that the sales of our bottled water products will be sustainable in the domestic market. We are also taking firm steps to improve our business operations in China.

La Nina to hurt air-con sales this year — Daikin

As the blistering heat of El Nino gives way to increased rainfalls under its wet cousin La Nina across Southeast Asia this year, air conditioner (air con) sales are expected to cool.

“I don’t think we will see similar [sales] numbers this year, as the market is shrinking. In the last two years, Malaysia and a major part of Southeast Asia were experiencing very hot El Nino weather and [air con] brands actually could not meet demand and ran out of stock in the months of April to June.”


Malaysia is IKEA’s near RM1 billion Asean distribution and supply chain hub

IKEA will invest RM908 million for the new centre, which will adopt the structure and technology of IKEA’s biggest regional distribution centre in Germany. IKEA will manage an inventory of 9,500 stock keeping units worth RM6.6 billion annually.

“With the establishment of the regional distribution and supply chain centre, Malaysia will strengthen its role in supporting IKEA’s growth in the Asean region. The centre will serve 12 retail stores in Asean, which will increase to 20 stores by 2026.”

Urgent need to regulate healthcare fees

…the central bank will come out with a framework as soon as possible to reduce the medical insurance rate, which is projected to rise to 12.7% this year.

…rising medical insurance in Malaysia and other countries in the region is partly due to unregulated rules.

“While doctors’ fees are regulated, other components of private hospital charges are not. We need a framework on private hospital charges so that prices remain fair and appropriate. Consumers are advised to request for more detailed billing of charges, breakdown of cost of treatment and medicines provided to them.”

Other components of hospital charges not regulated include fees for hospital stay, laboratory investigations, nursing care, use of equipment and operation room and drugs.