KLCI Stock - MMCCORP / 2194 - 2010 Quarter 2

Market Cap : 3045058552*2.77 = 8,434,812,189.04 (Very Large)
NTA per share : (6755766-8173923)/3045100 = Negative
P/BV : Not applicable
Forecast P/E now : (2.77.0.03)/0.0884 = 31.34 (High)
ROE : 3.21% (Low)
DY : 0.03/2.77*100 = 1.08% (Low)
Fixed Asset Turnover(3 year) : (0.2376+0.2334+0.223)/3 = 0.2313 (Low)
Liquidity Ratio : 7443488/6116686 = 1.2169 (Low)
Receivables Collection Period : (2277096+2055368)/2/(8741394/365) = 90 days (Acceptable)
My Target Price : Not interested unless revenue and profit increase more
My Decision : NOT BUY
My Comment : Revenue increased but profit remain low, strong cash, high debt but decreasing, navps same
Technical Support Price : 2.5
Risk Rating : MODERATE
OSK Target Price : 2.59 (25 Aug 10)

My notes based on 2010 quarter 1 report (number in '000):

- The Group's profit before tax for the six-month financial period ended 30 June 2010 was higher by 13% compared to the corresponding financial period ended 30 June 2009

- Lower losses recorded from Engineering & Construction division by 31.1% mainly attributed to additional contract revenue recognised from SMART. This was mitigated by higher share of losses from an associate, Zelan Berhad attributed to the recognition of losses on contracts for projects in Middle East and Indonesia coupled with impairment loss on goodwill for its engineering and construction division

- Lower losses recorded from Corporate & Others division by 16.3% mainly driven by the gain on disposal of investment in Integrated Rubber Corporation Berhad. This was offset by higher finance costs at MMC Company level

- The Group recorded a profit before tax of RM175.2 million in the current quarter as compared to RM210.4 million in the preceding quarter. This was mainly due to lower contribution from the transport and logistics division and the absence of gain on disposal of investment in Integrated Rubber Corporation Berhad as in preceding quarter

- Estimate next 4Q eps after 2010 Q2 result announced = 0.0402*2*1.1 = 0.0884, estimate PE on current price 2.77 = 31(DPS 0.03)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0777*1.1 = 0.0855, estimate highest/lowest PE = 31.23/25.73 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0777*1.1 = 0.0855, estimate highest/lowest PE = 29.82/25.38 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0297*4*0.9 = 0.1069, estimate highest/lowest PE = 23.43/20.63 (DPS 0.025)

MMCCORP latest news (English)