Published November 5, 2008
SembMarine Q3 profit jumps 73% to $141m
Revenue down slightly; operating profit nearly doubles to $142.1m
By VINCENT WEE
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RIG builder Sembcorp Marine continued to grow strongly in the third quarter with a 73 per cent rise in earnings to $140.9 million but turnover fell slightly to $1.14 billion from $1.17 billion a year ago.
Earnings boosters: Higher operating margins from rig building and shiprepair businesses and better contribution from associates nearly doubled operating profit
Operating profit nearly doubled to $142.1 million from $74.1 million previously due to higher operating margins from rig building and shiprepair businesses and better contribution from associated companies.
Gross profit margin improved from 8 per cent previously to 14 per cent. This was higher than the second quarter's 10 per cent and FY 2008's margin is expected to gradually trend upwards, SembMarine said.
General and administrative expenses, however, also rose 41.8 per cent from $21.5 million to $30.4 million mainly due to higher personnel-related costs as staff numbers rose due to more projects undertaken. Earnings per share rose from 3.92 cents to 6.8 cents in the third quarter.
By segment, rig-building revenue dipped 2.7 per cent to $631.4 million and offshore and conversion revenue fell 6.9 per cent to $285.2 million in the third quarter.
But repair revenue jumped 11.3 per cent to $210.7 million. For the first nine months, turnover rose 8.5 per cent to $3.45 billion from $3.18 billion previously. Profit rose 50.1 per cent to $360.5 million.
But the current global financial outlook and economic conditions are challenging, SembMarine warned.
The group, however, has a strong net order book of $9.9 billion extending out to 2012 comprising rig building, ship conversion and offshore projects. This includes new orders of $5.5 billion secured since January.
SembMarine expects shiprepair demand to remain strong amid global tightness in yard capacity while the fundamentals for the offshore sector remain intact.
'In the long term, exploration and production (E&P) activities will continue, in order to replace declining global oil and gas reserves and to increase production,' SembMarine said.
Although the current financial turmoil has a dampening impact on world economy and global demand for oil, SembMarine is confident that the long-term fundamentals and outlook for the marine and offshore industry remain positive.
SembMarine shares closed two cents lower at $1.93 yesterday.
Wednesday, 5 November 2008
Published November 5, 2008
More downside risks to Malaysian earnings
Citi expects global financial crisis to exact a toll
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(KUALA LUMPUR) Malaysian corporate earnings may shrink more than expected next year as the global financial crisis takes a toll on the local economy, Citigroup Inc said.
Citigroup, which in September called the stock market a 'pariah' because of heightened political concerns amid the rising popularity of opposition parties, said that there are more 'downside risks' to earnings which are already set to shrink 3.9 per cent next year. It previously estimated profit would rise 6 per cent.
Feedback from investors during a marketing trip in Singapore and Hong Kong focused on 'whether Malaysia is heading into a sharper downturn', Mr Choong Wai Kee, an analyst at Citigroup said in a report yesterday.
'Economic data rarely take the driver's seat, at least not in the past six months when politics dominated most conversations.' Economic growth will probably stall next year at zero per cent, making it the worst performance in 11 years, as commodity prices drop and the global financial crisis hurts exports, UBS AG said on Monday.
While Malaysia's stock market has been the best performer in South-east Asia this year, falling 38 per cent, its price-to-book value, which is headed towards the 2001 level of 1.4, is 'hardly a clarion call when other markets have fallen a lot more and are trading at lower valuations', said Mr Choong.
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'From a regional perspective, Malaysia does not stand out on valuation,' he said. -- Bloomberg
More downside risks to Malaysian earnings
Citi expects global financial crisis to exact a toll
Email this article
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(KUALA LUMPUR) Malaysian corporate earnings may shrink more than expected next year as the global financial crisis takes a toll on the local economy, Citigroup Inc said.
Citigroup, which in September called the stock market a 'pariah' because of heightened political concerns amid the rising popularity of opposition parties, said that there are more 'downside risks' to earnings which are already set to shrink 3.9 per cent next year. It previously estimated profit would rise 6 per cent.
Feedback from investors during a marketing trip in Singapore and Hong Kong focused on 'whether Malaysia is heading into a sharper downturn', Mr Choong Wai Kee, an analyst at Citigroup said in a report yesterday.
'Economic data rarely take the driver's seat, at least not in the past six months when politics dominated most conversations.' Economic growth will probably stall next year at zero per cent, making it the worst performance in 11 years, as commodity prices drop and the global financial crisis hurts exports, UBS AG said on Monday.
While Malaysia's stock market has been the best performer in South-east Asia this year, falling 38 per cent, its price-to-book value, which is headed towards the 2001 level of 1.4, is 'hardly a clarion call when other markets have fallen a lot more and are trading at lower valuations', said Mr Choong.
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'From a regional perspective, Malaysia does not stand out on valuation,' he said. -- Bloomberg
Published November 5, 2008
The family ties that bind in Malaysian politics
'Dynasty politics' will be around for a long time, according to some
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(KUALA LUMPUR) Politics often appears to be a family affair in Asia, and Malaysia now looks set to join the party.
Mr Najib: Has been in Parliament since the tender age of 22
Najib Razak, the 55-year-old son of Malaysia's second premier and the nephew of the third, will take the helm in March at a time when this Asian nation of 27 million people grapples with economic problems and rising political and ethnic tensions.
Another rising star of the party that has ruled Malaysia for all 51 years of its existence as a country is Mukhriz Mahathir, the son of its longest-serving prime minister, Mahathir Mohamad.
On the Opposition benches in Parliament sits Nurul Izzah Anwar and her father, veteran politician Anwar Ibrahim. Mr Anwar is a former deputy premier who once looked set for the top job until he was kicked out of the ruling party and jailed on what he says were false charges.
'There is an Asian belief that political power can be passed on to the next generation through bloodline,' said James Chin, political science professor at Monash University in Malaysia.
Critics say that the sense that blood entitles a person to exercise power has generated corruption, stymied development and hampered good government.
More often than not, the progeny of political leaders fail to live up to the family name.
'If Malaysians or foreigners expect Najib to be like his father as PM, they will be greatly disappointed,' said Abdullah Ahmad, a political author and a former aide to Mr Najib's father.
Mr Najib, who has a bachelor's degree in economics, will take over at a time when a re-energised Opposition led by Mr Anwar is seeking to gain power and when economic growth is skidding due to global financial turmoil.
Adding to his troubles, Mr Najib will need to address Malaysia's failure to keep up with more nimble neighbours in the competitiveness and investment stakes.
Growth in Malaysia's export-oriented economy looks set to fall to 3.4 per cent next year, the lowest since 2001. The budget deficit has soared due to spending on fuel subsidies and national infrastructure projects, according to the Malaysian Institute for Economic Research, a leading think tank.
'I pity Najib. He's taking over from the worst of times and from a man who messed things up,' said Mr Abdullah Ahmad, referring to the outgoing premier Abdullah Ahmad Badawi.
Mr Najib has been in Parliament since the tender age of 22 when he took over the seat of his father, who died in office.
He has held posts in the sports, education and defence ministries and now holds the powerful finance portfolio.
His father, Abdul Razak Hussein, designed Malaysia's race-based system which was supposed to help ethnic Malays climb the economic ladder and compete against the more entrepreneurial ethnic Chinese population. His uncle, Hussein Onn, is credited with forging unity among the races during his premiership.
Mr Najib's family links run to the heart of politics and business; his cousin is education minister and his younger brother Nazir runs Malaysia's second-largest bank CIMB.
Mr Najib's recent move on the top job has been marked by continued attacks on his integrity by the Opposition and by Internet bloggers obsessed with a lurid murder trial that involved Mr Najib's former aide. The aide was acquitted, but not before Mr Najib had to issue statements denying involvement.
Many political observers believe that Mr Najib may simply owe too much to too many people to stake out a separate political identity. He still needs to win a party election to take the top job, although he appears to have no real competition.
'He (Najib) was coddled and helped all along, first by his uncle Hussein Onn and then by Mahathir, the man who owed a debt of gratitude to his father,' said Zainon Ahmad, political editor of the local Sun newspaper. 'Only now I think Najib has to be on his own,' he said.
In another twist in dynastic affairs, Dr Mahathir's son, Mukhriz Mahathir is now battling Mr Abdullah's son-in-law Khairy Jamaluddin for the leadership of United Malays National Organisation's (Umno) influential youth wing, a staging post to the party presidency and the premiership of the country.
That political battle is a sign that dynasty politics will be around for a long time to come, worrying some Malaysians who feel that the country is governed neither by them, nor for them.
'The ones that keep coming back for more are the sons, daughters and grandchildren of yesteryear's leaders,' said a comment posted on political blog www.bakrimusa.com
'It is, to them, their birthright to be accorded such positions as their fathers and forefathers. If you are not born to 'the families', then you must marry into one!' - Reuters
The family ties that bind in Malaysian politics
'Dynasty politics' will be around for a long time, according to some
Email this article
Print article
Feedback
(KUALA LUMPUR) Politics often appears to be a family affair in Asia, and Malaysia now looks set to join the party.
Mr Najib: Has been in Parliament since the tender age of 22
Najib Razak, the 55-year-old son of Malaysia's second premier and the nephew of the third, will take the helm in March at a time when this Asian nation of 27 million people grapples with economic problems and rising political and ethnic tensions.
Another rising star of the party that has ruled Malaysia for all 51 years of its existence as a country is Mukhriz Mahathir, the son of its longest-serving prime minister, Mahathir Mohamad.
On the Opposition benches in Parliament sits Nurul Izzah Anwar and her father, veteran politician Anwar Ibrahim. Mr Anwar is a former deputy premier who once looked set for the top job until he was kicked out of the ruling party and jailed on what he says were false charges.
'There is an Asian belief that political power can be passed on to the next generation through bloodline,' said James Chin, political science professor at Monash University in Malaysia.
Critics say that the sense that blood entitles a person to exercise power has generated corruption, stymied development and hampered good government.
More often than not, the progeny of political leaders fail to live up to the family name.
'If Malaysians or foreigners expect Najib to be like his father as PM, they will be greatly disappointed,' said Abdullah Ahmad, a political author and a former aide to Mr Najib's father.
Mr Najib, who has a bachelor's degree in economics, will take over at a time when a re-energised Opposition led by Mr Anwar is seeking to gain power and when economic growth is skidding due to global financial turmoil.
Adding to his troubles, Mr Najib will need to address Malaysia's failure to keep up with more nimble neighbours in the competitiveness and investment stakes.
Growth in Malaysia's export-oriented economy looks set to fall to 3.4 per cent next year, the lowest since 2001. The budget deficit has soared due to spending on fuel subsidies and national infrastructure projects, according to the Malaysian Institute for Economic Research, a leading think tank.
'I pity Najib. He's taking over from the worst of times and from a man who messed things up,' said Mr Abdullah Ahmad, referring to the outgoing premier Abdullah Ahmad Badawi.
Mr Najib has been in Parliament since the tender age of 22 when he took over the seat of his father, who died in office.
He has held posts in the sports, education and defence ministries and now holds the powerful finance portfolio.
His father, Abdul Razak Hussein, designed Malaysia's race-based system which was supposed to help ethnic Malays climb the economic ladder and compete against the more entrepreneurial ethnic Chinese population. His uncle, Hussein Onn, is credited with forging unity among the races during his premiership.
Mr Najib's family links run to the heart of politics and business; his cousin is education minister and his younger brother Nazir runs Malaysia's second-largest bank CIMB.
Mr Najib's recent move on the top job has been marked by continued attacks on his integrity by the Opposition and by Internet bloggers obsessed with a lurid murder trial that involved Mr Najib's former aide. The aide was acquitted, but not before Mr Najib had to issue statements denying involvement.
Many political observers believe that Mr Najib may simply owe too much to too many people to stake out a separate political identity. He still needs to win a party election to take the top job, although he appears to have no real competition.
'He (Najib) was coddled and helped all along, first by his uncle Hussein Onn and then by Mahathir, the man who owed a debt of gratitude to his father,' said Zainon Ahmad, political editor of the local Sun newspaper. 'Only now I think Najib has to be on his own,' he said.
In another twist in dynastic affairs, Dr Mahathir's son, Mukhriz Mahathir is now battling Mr Abdullah's son-in-law Khairy Jamaluddin for the leadership of United Malays National Organisation's (Umno) influential youth wing, a staging post to the party presidency and the premiership of the country.
That political battle is a sign that dynasty politics will be around for a long time to come, worrying some Malaysians who feel that the country is governed neither by them, nor for them.
'The ones that keep coming back for more are the sons, daughters and grandchildren of yesteryear's leaders,' said a comment posted on political blog www.bakrimusa.com
'It is, to them, their birthright to be accorded such positions as their fathers and forefathers. If you are not born to 'the families', then you must marry into one!' - Reuters
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