MY Morning Wrap | Public Bank Reports 3.5% Drop in Net Profit for Q1FY2024

On Monday, the $Nasdaq Composite Index (.IXIC.US)$ and the $S&P 500 Index (.SPX.US)$ closed at record highs ahead of the earnings report from Nvidia, the last of the "Magnificent Seven" companies to report earnings. The tech-heavy Nasdaq gained 0.65% to reach an all-time intraday high and closed at a record, while the S&P 500 inched up 0.09%, also reaching a record high. However, the $Dow Jones Industrial Average (.DJI.US)$ fell 196.82 points or 0.49%.

$PBBANK (1295.MY)$: Public Bank Bhd, Malaysia's third-largest banking group by assets, has reported a 3.5% drop in net profit for the first quarter ended March 31, 2024, compared to a year earlier, mainly due to higher personnel costs and higher provisions. Net profit stood at RM1.65bn ($394m), or 8.52 sen per share, compared with RM1.71bn ($408m), or 8.83 sen per share, a year ago. Net interest income rose 2.8% year-on-year to RM2.73bn ($653m), while non-interest income edged up 0.5% to RM649.64m ($155m). The net interest margin, a measure of profitability from interests charged on loans after deducing returns paid to depositors, slipped five basis points to 2.21%, but improved six basis points from 4QFY2023.

$HUBLINE (7013.MY)$: Shipping company Hubline Bhd has confirmed that it is in talks with state-owned equity firm Ekuiti Nasional Bhd (Ekuinas) for the potential acquisition of Orkim Sdn Bhd. Hubline stated that it is in the preliminary stage of discussion with Ekuinas as it assesses the feasibility and strategic alignment of such an acquisition with its long-term goal. Ekuinas owns 95.5% of Orkim, a ship-owning company that specialises in energy transportation.

$BKAWAN (1899.MY)$ & $KLK (2445.MY)$: Batu Kawan Bhd and its 47.74% associate, Kuala Lumpur Kepong Bhd, have reported lower earnings for the second quarter ended March 31, 2024, amid continued underperformance in the manufacturing and property segments. Batu Kawan reported a 29.43% decrease in net profit to RM84.72m ($20.2m) or 21.54 sen per share in 2QFY2024, from RM120.05m or 30.51 sen per share a year earlier. Revenue fell 10.3% to RM5.66bn from RM6.31bn in 2QFY2023. KLK, on the other hand, said its net profit fell 38.65% to RM117.07m or 10.8 sen per share, from RM190.81m or 17.70 sen per share a year earlier. Quarterly revenue decreased 9.81% to RM5.46bn from RM6.05bn in 2QFY2023. Both companies have announced an interim dividend of 20 sen per share.

$MENANG (1694.MY)$: Menang Corp (M) Bhd, a property development and management group, has declared a special dividend of six sen a share as its quarterly earnings rose to a six-year high. The net profit more than doubled to RM7.32m ($1.7m) for the third quarter ended March 31, 2024, from RM3.28m a year earlier, while revenue fell 5.13% to RM21.03m from RM22.17m. The better quarterly earnings were due to an adjustment it made to reverse the over-accrued liability in the current quarter totalling RM4.57m. Meanwhile, it attributed the lower quarterly revenue to maintenance works and a lower interest income derived from operating financial assets.

$KOTRA (0002.MY)$: Health products manufacturer Kotra Industries Bhd (KL:KOTRA) said its net profit dropped 61% to RM6.83 million for its third quarter ended March 31, 2024 (3QFY2024), from RM17.5 million a year ago, mainly due to a less favourable product mix and lower sales. Revenue for the quarter fell 6% to RM55.88 million from RM59.4 million in 3QFY2023 due to weaker sales of pharmaceutical products in both the local and export markets, as well as supplement products in the local market.

$MEDIAC (5090.MY)$: Media Chinese International Ltd, which is currently making losses, has projected a net loss between $11m and $13m for the year ending March 31, 2024. This is higher compared to its net loss of $200,000 a year ago. The larger loss is due to factors such as a decrease in turnover from the publishing and printing segment for FY2024 compared with the previous year. The company also attributed the loss to write-offs and provisions for impairment losses of not less than $6m on the group’s property, plant and equipment as well as intangible assets for FY2024.

$FGV (5222.MY)$: A man's claim for RM24.92m ($5.96m) in damages against FGV Holdings Bhd has been struck out by a court in Sabah. The claim related to alleged fraudulent transactions and trespassing on land in the state held under native title. FGV's wholly-owned units, Sri Kehuma Sdn Bhd and Yapidmas Plantation Sdn Bhd, successfully struck out Eugene Kousai's claim with costs of MYR2,000. The suit centered around 41 parcels of land, which Kousai claimed to be the registered owner of under native title, and accused the two FGV units of conducting fraudulent transactions and trespassing on the land.

$BNASTRA (7195.MY)$: Datuk Tan Kak Seng, managing director and largest shareholder of Binastra Corp Bhd, has sold a 6% stake in the construction company for MYR36m ($8.6m). Tan's vehicle, JT Conglomerate Sdn Bhd, sold 30 million shares at MYR1.20 each. The share disposal reduced Tan's total stake in Binastra to 57.3%. Meanwhile, Binastra's executive director, Lee Seng Yong, acquired the 30 million share block, raising his stake in the company to 14.16%.

$BRIGHT (9938.MY)$: Datuk Ricky Wong Shee Kai, the largest shareholder in Bright Packaging Industry Bhd, has sold 20 million shares, or a 9.74% stake in the aluminium foil packaging materials manufacturer. Wong, who is in a legal dispute with the Securities Commission Malaysia, sold the stake on 17 May but retains an indirect stake of 23.2% or 47.63 million shares in the company via Wong SK Holdings Sdn Bhd. The company did not reveal the transaction costs. Datai Holdings Pte Ltd emerged as Bright Packaging Industry's new substantial shareholder after acquiring the 20 million shares.

$ANNUM (5082.MY)$: Datuk Seri Chin Kok Foong, the largest shareholder in Annum Bhd, has sold his entire 14.83% stake in the Practice Note 17 wood-based products manufacturer. Chin, formerly an executive director of engineering construction firm Ageson Bhd, sold the stake of 33.73 million shares on 16 May in a direct business transaction. The disposal value was not revealed in the Annum filing. Ageson's former non-executive director and largest shareholder, Datuk Seri Larry Liew Kok Leong, has acquired the shares Chin sold on the same day.

$PERTAMA (8532.MY)$: Pertama Digital Bhd has received approval from the Legal Affairs Division of the Prime Minister's Department to continue operating its digital court bail payment system, e-Jamin, at all applicable courts in Malaysia. The digital services firm said in an exchange filing that it sees "no significant impact on the group's operations as well as revenue stream" following the approval.