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					Malaysia

Daily Focus
DBS Group Research . Equity 1 April 2008
Key Indices KLCI FBM30 FBMEmas nd FBM 2 Board Daily Volume (m shrs) Daily Turnover (RMm) Daily Turnover (US$m) Market Key Data (%) 2007A 2008F 2009F (x) 2007A 2008F 2009F Stock Picks – Large Cap Public Bank-F BCHB PPB Group KNM Group YTL Power Stock Picks – Small Cap Sunrise Kinsteel Evergreen Southern Steel Litrak Price (RM) 31/03 2.18 1.13 1.29 2.07 3.58 Target Price 4.00 1.70 2.50 3.00 4.30 Price (RM) 31/03 10.90 9.95 10.20 5.30 2.43 Target Price 13.20 12.90 13.50 7.60 3.00 Current 1,248 8,233 8,424 5,885 617 1,091 341 % Chng -0.9 -1.0 -0.9 -0.8

Highlights
TH Plantations
Cheapest entry for high dividend yield (Buy; RM3.10; THP MK; TP RM4.70) We have tweaked our forecasts to reflect TH Plantations Bhd’s (THP) FY07 results. In particular, we have raised THP’s FY08F FFB yield to 21.3 MT/ha (from 20.8 MT/ha) and raised FY08F average achieved selling prices to 96% of spot prices (compared to 90% in our previous forecast), to account for the better-than-expected hedging. However, our forecast is also adjusted to reflect rising fertiliser costs – in line with persistently high energy prices. This will cause a significant adjustment in THP’s upkeep and harvesting cost per hectare, which we have increased by 36% in FY08F and by 35% in FY09F, from our previous forecasts to RM3,790 and RM3,796, respectively. While the higher costs should be more than offset by better hedging this year, we expect them to lower our profit expectations next year, when CPO prices are forecast to ease from this year’s peak.

EPS Gth 34.3 18.0 10.0 PER 16.3 13.8 12.5

Div Yield 3.1 3.5 3.8 EV/EBITDA 9.0 8.1 7.4

Comments
KL Kepong
Reduces stake in cocoa business (Buy; RM16.20; KLK MK; TP RM20.60) KL Kepong (KLK) announced its proposal to dispose its 60% stake (currently 100% stake) in KL-Kepong Cocoa Products Sdn Bhd (KLKCP) to Zurich-based Barry Callebaut Group for c. RM153.6m, plus 60% of the difference between KLKCP’s net working capital and net indebtness at completion. The deal is expected to be completed within one month, unless extended. KLK will then enter into a joint venture agreement with Barry Callebaut to manage KLKCP, where KLK will retain its 40% stake. While the deal is positive for KLKCP to further develop its business by riding on Barry’s global network and its expertise, we expect the deal to have insignificant impact on KLK’s earnings, given the immaterial contribution of the cocoa business to the overall net profit of the Group. We maintain our BUY call on KLK and DCF-based RM20.60 target price.

rear wheel bearing, which could lead to malfunctioning of the affected components.” Proton will bear the costs on replacing the parts. The company stated, “this recall is purely a precautionary measure, as the convenience and safety of customers is Proton’s highest priority.” The Savvy model makes up only 5% of Proton’s total unit sales. In our opinion, such an exercise is expected to have minimal impact on the Group’s huge cost base. We retain our forecast and target price of RM3.60, which is based on 55% discount to RNAV of RM8.11 apiece. We maintain our FULLY VALUED call on Proton.

Proton
Recalls Proton Savvy (Fully Valued; RM3.86; PROH MK; TP RM3.60) It has been reported that Proton was recalling 34,000 Proton Savvy cars “…to address the possibility of water entering the

www.dbsvickers.com Refer to important disclosures at the end of this report

Malaysia

Daily Focus

MAS
Orders narrow-body Boeing aircraft (Buy; RM3.54; MAS MK; TP RM5.80) Malaysian Airline System Bhd (MAS) announced that it will buy as many as 55 Boeing 737-800 aircraft for US$4.2bn (RM13.4bn) at list prices to replace older planes and to fly to new routes. MAS made a firm order for 35 planes and an option for another 20, and expects delivery of the first aircraft from September 2010. MAS also has the option of upgrading from B737-800 to the larger B737-900. Meanwhile, MAS said it will take delivery of all six A380-800s in 2011, with the first aircraft to be delivered in January and the sixth in August. The six A380-800 aircraft were supposed to have been delivered from January 2007 to December 2008. MAS will be receiving compensation from Airbus for the delay, but the amount was not disclosed. As the first A737-800 aircraft is only expected in September 2010, our estimates on earnings are unchanged. We are positive with the fleet expansion, as we understand the new aircraft will be used mainly for flights in the Asean region, including in Malaysia, and countries with fast-growing economies such as China and India where demand is expected to be strong. The new fleet will also be used to replace the existing B737-400 fleet and expand to places that were not previously economically viable. We maintain our BUY call on MAS with unchanged target price of RM5.80, based on 12x FY09 EPS. There is potential upside from better-than-expected yield, higher load factor and lower fuel prices.

y-t-d). If the encouraging traffic growth is sustained, it could provide upside to our earnings forecast. Every 1% increase in traffic volume lifts our projection on net profit by c.3%. We maintain our BUY call with a DCF-based target price of RM3.95. At current levels, the stock provides yield of 5.1%.

Plantation Sector
India scraps import duty on crude palm and soybean oils USDA report points to 18% rise in soybean plantings next season (Overweight) As reported in Bloomberg, India has scrapped its import duties on crude form of edible oils at a cabinet meeting yesterday to ensure supplies and curb inflation. The measure was to take effect at midnight. However, import on refined edible oil would still be at 7.5%. This latest move followed a cut on import duties on palm oil to 20% from 45% just two weeks earlier. The move signals more or less a consistent move by both India and China to absorb more supplies in a timely fashion, i.e. taking the opportunity for progressively easing prices in an effort to lower domestic food inflation. We believe this event illustrates that while demand was previously restraint due to high prices, they remain strong nevertheless. Separately, soybean oil prices also declined by 6.7% in CBOT overnight, which we believe would signal a similar movement in palm oil prices today. The drop essentially reflects US soybean planting intentions next season, which are to increase by 18% or c. 4.6m ha. This would effectively send soybean planted area back to 2006 levels, if materialised. Our assumptions on CPO price are based on the assumption that soybean planted declines by 2%. We will review our CPO price assumption to take this into account, though we believe supply should remain tight and demand should remain strong in the medium-term. We maintain our OVERWEIGHT rating on the plantation sector. Our picks for the sector are IOI Corporation, KL Kepong, Sime Darby, IJM Plantations and TSH Resources.

PLUS Expressways
Encouraging February traffic numbers (Buy; RM3.20; PLUS MK; TP RM3.95) Traffic volume on the Group’s expressways grew 10.6% y-o-y in February, bringing y-t-d growth to 7.7%. The growth could be partly due to the longer stretch of public holidays this year. First day of Lunar New Year last year was on Sunday. The above numbers exclude ELITE (up 12.0% y-o-y in Feb; up 9.5% y-t-d) and Linkedua (up 17.6% y-o-y in Feb; up 16.9%

Page 2 of 8

Malaysia Company Focus

TH Plantations Bhd
Bloomberg: THP MK

|

Reuters: THPB.KL

DBS Group Research . Equity

1 Apr 2008

BUY RM3.10 KLCI : 1,258.41
Price Target : 12-month RM 4.70 Reason for Report : Company update Potential Catalyst: Continued CPO price strength Analyst Ben Santoso +65 6398 7976 bensantoso@dbsvickers.com Juliana Ramli +603 2711 2222 juliana@hwangdbsvickers.com.my

Cheapest entry for high dividend yield
Story: We have tweaked our forecasts to reflect TH Plantations Bhd’s (THP) FY07 results. In particular, we have raised THP’s FY08F FFB yield to 21.3 MT/ha (from 20.8 MT/ha) and raised FY08F average achieved selling prices to 96% of spot prices (compared to 90% in our previous forecast), to account for the better-than-expected hedging. However, our forecast is also adjusted to reflect rising fertiliser costs – in line with persistently high energy prices. This will cause a significant adjustment in THP’s upkeep and harvesting cost per hectare, which we have increased by 36% in FY08F and by 35% in FY09F, from our previous forecasts to RM3,790 and RM3,796, respectively. While the higher costs should be more than offset by better hedging this year, we expect them to lower our profit expectations next year, when CPO prices are forecast to ease from this year’s peak. Point: Having adjusted for the above factors, THP’s FY08 and FY09 earnings forecast were therefore revised by 6% and – 4% to RM88.7m (+43% y-o-y) and RM74.7m (-16% y-o-y), respectively. For FY10, we project earnings to decline by 9% y-o-y to RM68.2m, due to expectation of lower CPO prices. We anticipate the Group to achieve average CPO price of RM2,568 per MT in FY10, assuming 97% of average spot price of RM2,650. Relevance: Maintain BUY with unchanged target price of RM4.70 apiece based on 30% discount to its DCF valuation. Our valuation implies 12.3x CY09 EPS. Currently, THP is trading at an appealing 8.1x CY09 EPS, among the lowest in the sector, with attractive net dividend yield of 6%.

Price Relative
RM Relative Index 219 3.60 3.10 2.60 2.10 69 1.60 1.10 Apr-06 19 Oct-06 Apr-07 Oct-07 169

119

TH Plantations Bhd (LHS)

Relative KLCI INDEX (RHS)

Forecasts and Valuation
FY Dec (RM m) 2007A 2008F 2009F 2010F

Turnover EBITDA Pre-tax Profit Net Profit Net Pft (Pre Ex.) EPS (sen) EPS Pre Ex. (sen) EPS Gth Pre Ex (%) Diluted EPS (sen) Net DPS (sen) BV Per Share (sen) PE (X) PE Pre Ex. (X) P/Cash Flow (X) EV/EBITDA (X) Net Div Yield (%) P/Book Value (X) Net Debt/Equity (X) ROAE (%) Earnings Rev (%): Consensus EPS (sen):

176 94 84 62 62 31.6 31.6 74 31.6 15.6 102.9 9.8 9.8 8.4 6.5 5.0 3.0 CASH 34.4

236 134 121 89 89 45.3 45.3 43 45.3 21.8 132.5 6.9 6.9 6.0 4.8 7.0 2.3 0.1 38.4 6.4 42.4

222 117 102 75 75 38.1 38.1 (16) 38.1 18.3 148.9 8.1 8.1 6.8 5.6 5.9 2.1 0.2 27.1 (3.2) 40.6

220 109 94 68 68 34.8 34.8 (9) 34.8 16.7 165.3 8.9 8.9 7.3 6.1 5.4 1.9 0.2 22.1 N/A 51.2

Sector : Plantation Principal Business: Pure oil palm plantation player

At A Glance Issued Capital (m shrs) Mkt. Cap (RMm/US$m) Major Shareholders Tabung Haji (%) Free Float (%) Avg. Daily Vol.(‘000)

196 608 / 190 60.1 39.9 165

www.dbsvickers.com Refer to important disclosures at the end of this report

TH Plantations

Company Focus

Highlights Improved hedging led us to raise achieved selling prices. The Group’s hedging policy is to sell forward 30% of its production in the short-term, another 30% on long-term basis; while the remaining 40% is sold in the spot market. Having updated our assumptions, THP’s revised selling prices would now be closer to the average CPO spot price as compared to our previous forecast. The FY08F and FY09F selling prices are adjusted upwards by 7% to RM2,989 per MT (or 96% of our average CPO spot price assumption of RM3,100), and by 2% to RM2,707 per MT (or 97% of our spot CPO price assumption of RM2,800 per MT), respectively. To date, 15% of CPO production is pre-sold. We understand that to date, THP had sold forward approximately 15% of its production at an average price of RM3,334 per MT up to September 2008 – higher than our full-year forecast of RM2,989 per MT CPO for FY08. FFB yield is expected to make strong recovery this year. Accounting for the yield recovery across the industry, we have also adjusted our FFB yield forecasts to 21.3 MT/ha in FY08, 21.6 MT/ha in FY09 and 21.1 MT/ha in FY10 (from 20.1 MT/ha, 20.8 MT/ha and 21.0 MT/ha respectively). Note that our yield expectation in FY08 is conservatively lower as compared to the Group’s KPI target of 21.4 MT/ha. With this in mind, any stronger yield improvement would provide more upside to our earnings expectations. In FY10, THP is expected to achieve a slightly lower FFB yield, mainly due to the dilution effect from the newly matured areas as well as reduced FFB production from the old mature trees cut down for replanting. As at the end of 2007, approximately 16% of THP’s total mature area is equal to or more than 25 years of age. We forecast the Group to replant 2-4% of its mature area per year between 2008 and 2010. THP to fill up existing landbank by FY09. In FY07, THP planted 3,597ha of land, slightly higher than our forecast of 3,498ha. Hence, we reduce our new planting assumption in FY09 to 6,371ha (from 6,484ha previously), mainly for factoring in the remaining plantable landbank. Meanwhile, we maintain our new planting assumption in FY08 at c.3,500 ha. By FY09, the Group is expected to have a total planted area of 28,013ha (98% of existing total landbank).

Still on the lookout for brownfield acquisitions to achieve THP’s KPI target of 32,000ha planted area by FY09. We have yet to factor in additional planted landbank in our analysis. Thus, any such acquisition would provide an additional upside to our earnings forecast. Key assumptions
2007A Hectareage Mature plantation Immature plantation Planted area Productivity Avg FFB yield (MT/ha) CPO extraction rate (OER), % CPO yield (MT/ha) PK extraction rate (KER), % PK yield (MT/ha) Production (MT) FFB harvested FFB purchased CPO production PK production Average selling prices (RM/MT) Average FFB price Average CPO price Average PK price 14,452 4,529 18,981 19.9 20.2 4.0 5.6 1.1 2008F 2009F 2010F

14,228 14,129 14,585 7,714 13,884 13,412 21,942 28,013 27,997 21.3 20.2 4.3 5.6 1.2 21.6 20.2 4.3 5.6 1.2 21.1 20.2 4.3 5.6 1.2

287,136 303,548 304,790 308,448 37,221 36,817 47,853 57,751 58,419 62,061 65,164 68,422 16,337 17,356 18,224 19,135 512 2,387 1,439 596 2,989 1,802 548 2,707 1,636 528 2,568 1,556

Source: Company, HwangDBS Vickers Research

Valuation Maintain BUY with an unchanged target price of RM4.70 per share, premised on 30% discount to its 10-year DCF valuation (WACC 9.8% and terminal growth rate of 5%). Our upgrade in earnings, reflecting better hedging and FFB yield recovery, was offset by higher upkeep and harvesting costs. Despite the higher costs, THP is still making historically high margins and is expected to book stronger volume growth in 2011F, when last year’s new planting came to maturity. As a result, NPV of our free cash flow forecasts were just a tad lower. Combined with higher net cash forecast, THP’s DCF value was essentially unchanged. Based on our revised forecasts, our valuation implies 12.3x CY09 EPS. Currently, THP is trading at an appealing 8.1x CY09 EPS, among the lowest in the sector, with attractive net dividend yield of 6%.

Page 4 of 8

Company Focus

TH Plantations

DCF valuation
Cost of debt Tax rate Kd Cost of equity Risk free rate (Rf) Market return rate (Rm) Beta (ß) Risk premium (Rm-Rf) Ke Discount factor @ WACC 9.8% Operating profit Tax Operating profit after tax Amortisation & depreciation Gross cash flow Capital expenditures Incremental working capital Free cash flow PV of free cash flow (RM m) Total PV of free cash flow (RM m) PV of residual value (RM m) Corporate value (RM m) Net cash (debt) (RM m) Shareholder value (RM mn) Intrinsic value/share (RM) 26.0% 3.7% 3.6% 10.0% 1.0 6.4% 10.0% 2009 1.00 102.3 (26.6) 75.7 14.8 90.5 (66.2) 5.4 29.7 29.7 500.3 834.3 1,334.6 (30.4) 1,304.3 6.65 2010 0.91 93.8 (24.4) 69.4 15.4 84.8 (54.4) 2.6 32.9 30.0 WACC (%) Equity portion of capital Ke Debt portion of capital Kd Average WACC Terminal value Perpetual growth rate Implied FY09F EBITDA multiple 2011 0.83 95.8 (24.9) 70.9 17.1 87.9 (38.5) (0.3) 49.2 40.8 2012 0.76 98.1 (26.2) 71.9 19.7 91.6 (22.1) (0.7) 68.8 52.0 2013 0.69 107.7 (28.7) 79.1 22.8 101.9 (22.7) (2.3) 76.9 53.0 2014 0.63 115.6 (30.7) 84.9 25.7 110.7 (22.9) (1.6) 86.2 54.1 96.3% 10.0% 3.7% 3.7% 9.8% 5.0% 7.12 2015 0.57 127.0 (33.3) 93.6 27.0 120.7 (23.0) (2.5) 95.2 54.4 2016 0.52 127.1 (33.0) 94.1 28.3 122.4 (22.9) 0.3 99.7 51.9 2017 0.47 133.1 (34.6) 98.5 29.6 128.1 (23.0) (1.3) 103.8 49.3 2018 0.43 129.0 (33.5) 95.5 30.9 126.3 (23.2) 1.6 104.7 45.3 2019 0.39 121.5 (31.6) 89.9 32.2 122.1 (23.7) 2.7 101.0 39.8

Source: DBS Vickers

Peers comparison
09F planted 09F 09F total No. of (own) s mallholders planted s hares L and bank (hec tares ) (hec tares ) (hec tares ) (hec tares ) (m) Indones ia As tra Agro L es tari B akrie S umatra* L ondon S umatra* T unas B aru L ampung* Malays ia As iatic Development CB Indus trial P roduct** IJ M P lantations IOI Corporation** KL Kepong P P B Group S ime Darby # T H P lantation T S H R es ources 258,907 n/a n/a n/a 211,471 78,268 123,364 36,569 59,965 14,533 45,972 10,000 271,436 92,801 169,336 46,569 1,575 4,151 1,365 4,542 S hare pric e per 31/3/08 Rp Rp Rp Rp 25,850 1,624 8,950 399 Market c ap (m) US $ US $ US $ US $ 4,404 729 1,321 196 US $ US $ US $ US $ EV (m) 4,242 870 1,277 258 09F E V/planted (own) US $ 20,059 US $ 11,115 US $ 10,349 US $ 7,067 R ec . T arget pric e B as is

Hold B uy B uy B uy

R p 32,300 R p 3,050 R p 14,800 Rp 780

DCF DCF DCF DCF

164,264 9,656 63,490 220,593 203,322 n/a 553,786 29,211 67,841

71,910 7,739 27,420 175,375 172,460 n/a 521,393 28,013 40,000

n/a n/a n/a n/a n/a n/a n/a n/a 0

71,910 7,739 27,420 175,375 172,460 n/a 521,393 28,013 40,000

756 138 637 6,108 1,068 1,186 6,009 196 413

RM RM RM RM RM RM RM RM RM

8.40 4.18 3.58 7.10 16.20 10.20 9.35 3.10 2.87

US $ US $ US $ US $ US $ US $ US $ US $ US $

1,986 180 714 13,568 5,411 3,783 17,580 190 371

US $ 1,758 US $ 226 US $ 640 US $ 14,319 US $ 5,577 US $ 3,285 US $ 17,689 US $ 201 US $ 501

US $ 24,450 US $ 29,237 US $ 23,332 US $ 81,647 US $ 32,338 n/a US $ 33,926 US $ 7,186 US $ 12,515

B uy B uy B uy B uy B uy B uy B uy B uy B uy

R M 9.35 DCF R M 7.90 P E R M 4.75 DCF R M 8.70 S OP R M 20.60 DCF R M 13.50 S OP R M 12.40 S OP R M 4.70 DCF R M 5.00 DCF

S ingapore F irs t R es ources 175,315 107,240 8,965 Wilmar International 573,401 283,838 32,132 * Inc luding rubber and other c rops ** E x c luding effec tiv e s take in as s oc iates land bank # T P is R M14.15 if B akun HE P is inc luded

116,205 315,970

1,468 6,386

S$ S$

1.05 4.15

US $ US $

1,117 19,195

US $ 1,072 US $ 19,403

US $ 9,994 US $ 68,361

B uy B uy

S$ S$

2.00 DCF 5.90 DCF

Page 5 of 8

TH Plantations
F Y06 Indones ia As tra Agro L es tari B akrie S umatra L ondon S umatra T unas B aru L ampung S imple av erage Malay s ia As iatic Development CB Indus trial P roduct IJ M P lantations IOI Corporation KL Kepong P P B Group S ime Darby T H P lantation T S H R es ources S imple av g. S ingapore F irs t R es ources Wilmar International 51.7 24.0 32.3 34.3 35.6 F Y07F 22.3 28.7 24.1 20.8 24.0 P E R (x ) F Y08F 14.2 13.9 12.0 12.0 13.0 F Y09F 15.0 10.8 11.7 10.2 11.9 F Y06 30.6 14.6 16.4 9.1 17.7 E V/E B IT DA (x ) F Y07F F Y08F 14.0 15.8 13.1 7.5 12.6 8.7 9.6 7.0 5.7 7.7 F Y09F 9.4 7.6 6.5 5.0 7.1

Company Focus
CY = Calenderis ed Year (J an - Dec ) F Y = F inanc ial Year ending As tra Agro L es t. December B akrie S umatra December L ondon S umatra December T unas B aru L . December

37.0 17.9 51.2 48.9 39.6 21.6 n/a 17.0 23.0 32.0

18.4 12.4 44.6 29.4 24.9 1.7 21.3 9.8 14.3 19.7

13.4 7.9 16.7 21.7 18.0 16.6 19.3 6.9 9.6 14.5

14.8 6.3 12.3 19.6 17.7 15.5 15.8 8.1 8.8 13.2

25.4 15.7 24.2 29.2 23.7 12.0 n/a 9.8 14.9 19.3

12.3 10.4 23.5 21.7 16.7 17.7 12.5 6.5 10.3 14.6

8.8 8.0 10.3 16.2 11.5 11.0 10.6 4.8 8.1 9.9

9.2 6.7 7.7 14.4 11.1 10.1 9.1 5.6 7.5 9.1

As iatic Dev. CB IP IJ M P lantations IOI Corp. KL Kepong P P B Group S ime Darby T H P lantations T S H R es ources

December March J une S eptember J une December December

42.3 35.3

23.9 33.1 EPS

9.5 24.8

10.6 22.7

17.0 21.5

10.3 21.5

5.3 16.0

5.5 14.0

F irs t R es ources Wilmar Int'l

December December

F Y06 Indones ia As tra Agro L es tari (R p) B akrie S umatra (R p) L ondon S umatra (R p) T unas B aru L ampung (R p) Malay s ia As iatic Development (s en) CB Indus trial P roduct (s en) IJ M P lantations (s en) IOI Corporation (s en) KL Kepong (s en) P P B Group (s en) S ime Darby (s en) T H P lantation (s en) T S H R es ources (s en) S ingapore F irs t R es ources (R p) Wilmar Int'l (US cents ) 500 74 277 13

F Y07F 1,161 62 372 21

F Y08F 1,822 128 743 37

F Y09F 1,728 165 766 43

F Y06 29.3 30.5 24.8 7.7

R OE (%) F Y07F F Y08F 55.5 18.1 31.2 9.7 61.4 22.5 42.5 15.5

F Y09F 45.8 24.0 30.6 16.3 US D/S GD US D/IDR US D/MYR S GC/IDR 1.38 9,245 3.20 6,696

22.7 23.4 7.0 14.5 40.9 47.3 n/a 18.2 12.5

45.7 33.6 8.0 24.1 65.0 589.3 43.8 31.6 20.1

62.6 52.8 21.4 32.7 90.1 61.5 48.3 45.3 29.7

56.9 66.3 29.2 36.3 91.6 66.0 59.2 38.1 32.6

10.2 24.8 6.8 15.2 10.0 12.7 n/a 25.3 12.4

18.0 29.1 7.7 21.5 14.7 86.8 n/a 34.4 16.1

21.0 36.2 18.2 26.5 18.5 6.3 14.5 38.4 18.9

16.5 35.3 21.3 27.3 17.0 6.5 16.2 27.1 17.8

166.1 8.5

293.7 9.1

740.3 12.1

661.7 13.2

25.1 38.4

20.6 13.3

29.0 9.5

20.3 9.6

F Y06 Indones ia As tra Agro L es tari B akrie S umatra L ondon S umatra T unas B aru L ampung Malay s ia As iatic Development CB Indus trial P roduct IJ M P lantations IOI Corporation KL Kepong P P B Group S ime Darby T H P lantation T S H R es ources S ingapore F irs t R es ources Wilmar Int'l 144.3 35.3 66.0 24.3

E B IT DA (US $m) F Y07F F Y08F 308.2 53.8 103.5 32.9 486.4 90.9 182.9 45.3

F Y09F 451.4 110.4 185.7 54.0

F Y06 1.6 0.5 0.9

Div idend yield (%) F Y07F F Y08F 1.8 0.6 1.4 2.5 2.9 1.3 -

F Y09F 4.6 1.7 3.0

74.9 11.7 25.3 455.4 229.8 322.2 n/a 18.2 30.0

148.6 17.9 27.2 655.6 338.1 204.4 1,421.3 29.5 44.2

200.3 28.3 62.0 887.7 485.7 299.0 1,675.7 41.9 61.5

183.8 33.9 81.2 971.6 496.9 319.0 1,922.6 36.6 69.0

0.6 1.7 0.1 1.0 2.2 2.0 n/a 2.9 1.7

1.2 2.4 0.1 1.4 2.3 2.5 2.3 5.0 1.7

1.7 3.8 0.4 2.3 2.9 3.3 2.6 7.0 1.7

1.5 4.8 0.5 2.6 2.9 3.6 3.2 5.9 1.7

71.8 425.1

109.9 1,105.1

204.1 1,510.7

186.4 1,721.7

0.0 0.3

0.0 0.5

0.0 0.6

0.0 0.7

S ource: DB S Vickers

Page 6 of 8

Company Focus
Income Statement (RM m)
FY Dec 2007A 2008F 2009F 2010F

TH Plantations
Balance Sheet (RM m)
FY Dec 2007A 2008F 2009F 2010F

Turnover Cost of Goods Sold Gross Profit Other Opng (Exp)/Inc Operating Profit Other Non Opg (Exp)/Inc Associates & JV Inc Net Interest (Exp)/Inc Exceptional Gain/(Loss) Pre-tax Profit Tax Minority Interest Preference Dividend Net Profit Net Profit before Except. EBITDA Sales Gth (%) EBITDA Gth (%) Opg Profit Gth (%) Net Profit Gth (%) Effective Tax Rate (%) Cash Flow Statement (RM m)
FY Dec

176 (88) 88 (4) 84 0 0 0 0 84 (23) 1 0 62 62 94 45.5 64.0 70.7 73.5 26.9
2007A

236 (109) 127 (6) 121 0 0 0 0 121 (33) 1 0 89 89 134 34.5 42.3 44.4 43.4 27.0
2008F

222 (113) 109 (7) 102 0 0 0 0 102 (28) 0 0 75 75 117 (5.9) (12.6) (15.4) (15.8) 27.2
2009F

220 (119) 101 (7) 94 0 0 0 0 94 (26) 0 0 68 68 109 (1.2) (6.8) (8.3) (8.7) 27.3

Net Fixed Assets Invts in Associates & JVs Other LT Assets Cash & ST Invts Other Current Assets Total Assets ST Debt Other Current Liab LT Debt Other LT Liabilities Shareholder’s Equity Minority Interests Total Cap. & Liab. Non-Cash Wkg. Capital Net Cash/(Debt)

164 0 59 39 67 328 0 54 36 31 202 6 328 13 2

215 0 87 20 77 398 0 52 50 31 260 5 398 25 (30)

219 0 134 5 74 431 0 53 50 32 292 5 431 21 (45)

227 0 165 0 73 466 0 55 50 32 324 5 466 19 (50)

Rates & Ratio
2010F FY Dec 2007A 2008F 2009F 2010F

Pre-Tax Profit Dep. & Amort. Tax Paid Assoc. & JV Inc/(loss) Chg in Wkg.Cap. Other Operating CF Net Operating CF Other Invts.(net) Invts in Assoc. & JV Div from Assoc & JV Other Investing CF Net Investing CF Div Paid Chg in Gross Debt Capital Issues Other Financing CF Net Financing CF Net Cashflow
FY Dec

84 10 (7) 0 7 0 94 0 0 0 0 (119) (18) 36 0 6 24 (1)
1Q2007

121 13 (30) 0 (14) (1) 90 0 0 0 0 (92) (31) 14 0 (1) (18) (19)
2Q2007

102 15 (27) 0 5 (1) 94 0 0 0 0 (66) (43) 0 0 0 (43) (15)
3Q2007

94 15 (25) 0 3 (1) 86 0 0 0 0 (54) (36) 0 0 0 (36) (4)
4Q2007

Gross Margins (%) Opg Profit Margin (%) Net Profit Margin (%) ROAE (%) ROA (%) ROCE (%) Div Payout Ratio (%) Asset Turnover (x) Debtors Turn (avg days) Creditors Turn (avg days) Inventory Turn (avg days) Current Ratio (x) Quick Ratio (x) Net Debt/Equity (X) Capex to Debt (%) N. Cash/(Debt)PS (sen) Opg CFPS (sen) Free CFPS (sen)

50.1 47.7 35.2 34.4 23.3 33.5 49.5 0.7 103.3 164.4 34.3 2.0 1.7 CASH 326.5 1.1 44.4 (12.9)

53.9 51.2 37.6 38.4 24.4 35.1 48.1 0.6 93.1 168.8 39.2 1.9 1.7 0.1 183.1 (15.5) 53.0 (0.6)

49.0 46.0 33.6 27.1 18.0 23.4 48.1 0.5 106.5 161.5 33.6 1.5 1.3 0.2 132.4 (23.1) 45.2 14.2

45.8 42.7 31.1 22.1 15.2 18.9 48.1 0.5 103.9 160.8 33.5 1.3 1.1 0.2 108.9 (25.3) 42.5 16.1

Quarterly / Interim Income Statement (RM m) Turnover Cost of Goods Sold Gross Profit Other Oper. (Exp)/Inc Operating Profit Other Non Opg (Exp)/Inc Associates & JV Inc Net Interest (Exp)/Inc Exceptional Gain/(Loss) Pre-tax Profit Tax Minority Interest Net Profit Net profit bef Except. EBITDA Sales Gth (%) EBITDA Gth (%) Opg Profit Gth (%) Net Profit Gth (%) Gross Margins (%) Opg Profit Margins (%) Net Profit Margins (%) 27 (14) 14 (1) 13 0 0 0 0 13 (3) 0 9 9 13 (24.5) (30.2) (30.3) (33.4) 49.8 46.3 33.7 37 (20) 17 (2) 15 0 0 0 0 15 (3) 0 11 11 15 33.5 16.4 16.4 23.3 45.9 40.4 31.2 49 (26) 23 (1) 22 0 0 0 0 21 (4) 0 18 18 22 33.6 46.3 46.3 54.2 46.2 44.2 36.0 63 (28) 35 (2) 33 0 0 0 0 34 (11) 1 24 24 33 28.6 54.8 54.8 34.3 55.8 53.2 37.6

Source: Company, DBS Vickers

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TH Plantations

Company Focus

DBSV recommendations are based an Absolute Total Return* Rating system, defined as follows: STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame) BUY (>15% total return over the next 12 months for small caps, >10% for large caps) HOLD (0-15% total return over the next 12 months for small caps, 0-10% for large caps) FULLY VALUED (negative total return i.e. > -10% over the next 12 months) SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)

* Share price appreciation + dividends
DBS Vickers Research is available on the following electronic platforms: DBS Vickers (www.dbsvresearch.com); Thomson (www.thomson.com/financial); Factset (www.factset.com); Reuters (www.rbr.reuters.com); Capital IQ (www.capitaliq.com) and Bloomberg (DBSR GO). For access, please contact your DBSV salesperson. In Singapore, this research report may only be distributed to Institutional Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore. ANALYST CERTIFICATION The research analyst primarily responsible for the content of this research report, in part or in whole certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views. The analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. Compensation for investment banking services: DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBSVUSA have received compensation, within the past 12 months, and within the next 3 months may receive or intends to seek compensation for investment banking services from Compensation for Wilmar and Sime Darby. This document is published by DBS Vickers Research (Singapore) Pte Ltd ("DBSVR"), a direct wholly-owned subsidiary of DBS Vickers Securities (Singapore) Pte Ltd ("DBSVS") and an indirect wholly-owned subsidiary of DBS Vickers Securities Holdings Pte Ltd ("DBSVH"). The research is based on information obtained from sources believed to be reliable, but we do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain separate legal or financial advice. DBSVR accepts no liability whatsoever for any direct or consequential loss arising from any use of this document or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. DBS Vickers Securities Holdings Pte Ltd is a wholly-owned subsidiary of DBS Bank Ltd. DBS Bank Ltd along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. DBSVR, DBSVS, DBS Bank Ltd and their associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBS Vickers Securities (USA) Inc ("DBSVUSA"), a U.S.-registered broker-dealer, may beneficially own a total of 1% or more of any class of common equity securities of the subject company mentioned in this document. DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBSVUSA, within the past 12 months, have received compensation and/or within the next 3 months seek to obtain compensation for investment banking services from the Sime Darby and Wilmar International. DBSVUSA does not have its own investment banking or research department, nor has it participated in any investment banking transaction as a manager or co-manager in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively. DBS Vickers Securities (UK) Ltd is an authorised person in the meaning of the Financial Services and Markets Act and is regulated by The Financial Services Authority. Research distributed in the UK is intended only for institutional clients. DBS Vickers Research (Singapore) Pte Ltd – 8 Cross Street, #02-01 PWC Building, Singapore 048424 Tel. 65-6533 9688, Fax: 65-6226 8048 Company Regn. No. 198600295W

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