MY Morning Wrap | Public Bank Bhd Reports 5.73% YoY Decline in 4QFY2023 Net Profit Due to High Provision for Loan Impairment and Operating Expenses

The artificial intelligence mania that fueled the stock market to record highs this year was taking a breather Wednesday. Shares of chip makers were among those posting declines. $NVIDIA (NVDA.US)$ shares were roughly flat. Stock indexes fell. The $S&P 500 Index (.SPX.US)$ fell 0.17%, while the $Nasdaq Composite Index (.IXIC.US)$ fell 0.55% and $Dow Jones Industrial Average (.DJI.US)$ fell 0.06%.

$MAYBANK (1155.MY)$: Maybank has reported an 8.3% year-on-year rise in net profit for the fourth quarter ended Dec 31, 2023 (4QFY2023), primarily driven by strong gains in its insurance segment and non-interest income, which offset a decline in net interest income. The bank's net profit for 4QFY2023 stood at RM2.39 billion, up from RM2.21 billion for the same period in the previous year. While net interest income fell by 9.4% year-on-year to RM3.18 billion, non-interest income rose by 5.4% to RM1.90 billion. Maybank has set a return-on-equity target of 11% for 2024 and declared a full-cash second interim dividend of 31 sen per share, raising the full-year dividends to 60 sen per share, which translates into a payout of 77.4%. For the full FY2023, Maybank's net profit surged by 17% to RM9.35 billion from RM7.96 billion in the previous year, with net interest income falling by 7.4% to RM12.79 billion, and non-interest income surging by 74% to RM7.98 billion due to higher investment income and paper gains.

$PBBANK (1295.MY)$: Public Bank Bhd has reported a 5.73% year-on-year decline in its net profit for the fourth quarter ended Dec 31, 2023, due to high allowance for loan impairment, higher operating expenses, and lower net interest income. The bank's net profit for the quarter was RM1.62 billion, down from RM1.71 billion in the same period a year earlier, while revenue increased by 8% to RM6.55 billion from RM6.06 billion. For the full year ended Dec 31, 2023 (FY2023), Public Bank's net profit expanded by 8.66% to RM6.65 billion from RM6.12 billion, with revenue climbing by 18.91% to RM25.42 billion from RM21.43 billion. The bank has declared a dividend of 10 sen per share for the quarter, to be paid on March 22, bringing the total dividends for FY2023 to 19 sen per share, amounting to RM3.69 billion, which is higher than the total dividends paid in the past three years.

$HLBANK (5819.MY)$: Hong Leong Financial Group Bhd (HLFG), which owns 64% of HLB, has reported a 2.5% year-on-year growth in net profit for 2QFY2024 to RM831.87 million, up from RM811.5 million a year ago. The growth was primarily driven by higher contributions from its commercial banking, investment banking, and stockbroking divisions. This was despite the net interest income falling by 0.4% to RM975.86 million for 2QFY2024, down from RM979.86 million a year earlier. The group, which is 78%-controlled by tycoon Tan Sri Quek Leng Chan, has declared an interim dividend of 18 sen, with an ex-date of March 14.

$CAPITALA (5099.MY)$: Capital A Bhd has announced its plan to transfer the manager of its aviation brand AirAsia to Nasdaq-listed special purpose acquisition company (SPAC) Aetherium Acquisition Corp for US$1.15 billion (RM5.48 billion) in order to facilitate its exit from Practice Note 17 (PN17) status. Additionally, the company will sell its aviation business to AirAsia X Bhd. Under the agreement, Capital A will receive an equity stake worth US$1 billion in the newly formed US-listed entity, Capital A International (CAPI). As part of the sale consideration settlement, Capital A will also offload a US$150 million loan to CAPI. The proposed transaction includes the distribution of CAPI shares to Capital A's shareholders.

$IOIPG (5249.MY)$: IOI Properties Group Bhd has reported a 69.78% year-on-year decline in its net profit for the second quarter ended Dec 31, 2023 (2QFY2024), primarily due to weaker performance in its property development segment as well as its hospitality and leisure business. The company's net profit for the quarter was RM121.5 million, down from RM401.98 million a year earlier, while quarterly revenue declined by 9.48% to RM606.9 million from RM670.44 million in 2QFY2023. On a quarter-on-quarter basis, the company's net profit fell by 30.35% from RM174.45 million, while revenue dropped 6.35% from RM648.05 million. For the first six months of FY2024, IOI Properties' net profit slumped by 71.61% to RM295.94 million from RM1.04 billion in the same period of FY2023, dragged by all business segments except property investment. Half-year revenue fell by 7.86% to RM1.25 billion from RM1.36 billion, mainly due to lower sales from the property development segment in Malaysia and China.

$GENP (2291.MY)$: Genting Plantations Bhd has reported a 13% year-on-year growth in net profit for the fourth quarter ended Dec 31, 2023 (4QFY2023), primarily driven by stronger fresh fruit bunches (FFB) production, which offset the impact of weaker palm product prices and lower sales at the group's downstream manufacturing business. The company's net profit for 4QFY2023 rose to RM63.19 million or 7.04 sen per share, up from RM55.86 million or 6.23 sen per share in 4QFY2022, while revenue for the quarter was at RM800.46 million, up 1.2% from RM791.19 million in the previous year. The company has declared a final dividend of four sen per share and a special dividend of nine sen per share, with an ex-date of March 14, raising its total payout for FY2023 to 21 sen per share, which is lower than the 34 sen per share paid for FY2022. However, for the full FY2023, Genting Plantations' net profit fell by 46% to RM253.49 million from RM471.42 million in FY2022, dragged down by weaker palm product prices, with revenue dropping by 7% to RM2.97 billion from RM3.19 billion.

$MYEG (0138.MY)$: MyEG Services Bhd has reported a 100% year-on-year growth in net profit for the fourth quarter ended Dec 31, 2023 (4QFY2023), doubling to RM150.16 million from RM74.69 million a year earlier, on the back of strong revenue growth of 42.4% to RM222.06 million from RM155.99 million. The company attributed the higher quarterly earnings to its Zetrix blockchain platform, sale of Zetrix tokens, and the initial exchange offering of Zetrix tokens on three major global digital asset exchanges. The digital service provider has proposed a final dividend of 1.68 sen per share, raising its dividend payout for FY2023 to 1.93 sen, which is 0.51 sen higher than the 1.42 sen paid for FY2022. For the full financial year ended Dec 31, 2023 (FY2023), MyEG's net profit expanded by 22.32% to RM487.65 million from RM398.66 million in FY2022, as revenue increased by 20.57% to RM774.28 million from RM642.16 million a year earlier.

$HAPSENG (3034.MY)$: Hap Seng Consolidated Bhd has reported a 61.88% year-on-year decline in net profit for the fourth quarter ended Dec 31, 2023 (4QFY2023), falling to RM37.36 million from RM98.02 million a year ago, primarily due to lower operating profit dragged by lower profit contribution from all divisions except the building materials division. The company's quarterly revenue also declined by 26.91% to RM1.31 billion against RM1.79 billion in the previous year, mainly due to lower revenue from its credit financing, automotive, and trading divisions. For the full year, Hap Seng's net profit fell by 15.81% to RM800.33 million compared to RM950.66 million in FY2022, as revenue slid by 14.41% to RM6.09 billion from RM7.11 billion a year ago.