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Categories
| Kilat Kaca exits Kawan Food |
| Business & Market 2009 | |||
| Written by Chong Jin Hun | |||
| Tuesday, 18 August 2009 11:37 | |||
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Kawan Food told the stock exchange yesterday that the transaction was carried out last Friday. Based on the stock’s closing price of 75.5 sen on that day, Kilat Kaca’s stake in Kawan Food was worth RM21.74 million. As a result of the disposal, Kilat Kaca and its owners Datuk Ibrahim Ahmad and Tan Sri Mohd Ibrahim Mohd Zain are no longer substantial shareholders in Kawan Food. Ibrahim is the non-independent non-executive director of Kawan Food while Mohd Ibrahim is the non-independent non-executive chairman. Kawan Food managing director Gan Thiam Chai, who is the largest shareholder with a 33.3% stake, could not be reached for comment at the time of writing. According to its latest annual report, Thiam Chai’s wife Kwan Sok Kay holds 8.56% of Kawan Food and his brother Thiam Hock 8.4%. The three have a combined 50.26% stake in the company. An analyst from Kenanga Investment Bank said its was possible that Kilat Kaca had sold its shares to capitalise on the stock’s price rise. “Kawan Food’s share price has gone up a bit,” the analyst told The Edge Financial Daily yesterday. Another analyst said: “According to Kawan Food’s management, Kilat Kaca had wanted to cash out.” Since last April, another major shareholder Lembaga Tabung Angkatan Tentera (LTAT), had disposed of 414,500 shares of Kawan Food, bringing down its interest in the company to less than 5%. As such, LTAT has ceased to be a major shareholder in Kawan Food. Kilat Kaca and LTAT’s exit as major shareholders in Kawan Food coincided with the Foreign Investment Committee’s (FIC) recent policy revision which provided that companies seeking a listing here no longer need to fulfil the 30% bumiputera equity criterion. However, these entities are required to earmark half of their 25% public spread requirement to bumiputera investors under the Securities Commission’s regulations. The new policies were announced in June this year. Kawan Food told Bursa Malaysia yesterday its second quarter (2Q) net profit grew on both annual and quarterly basis, helped by higher sales of its frozen food products. Net profit in the quarter ended June rose 53.9% to RM3.54 million from RM2.3 million a year earlier while revenue increased 26.2% to RM22.65 million from RM17.95 million. First-half net profit surged 76% to RM6.46 million from RM3.67 million while revenue was up 30.6% to RM43.63 million from RM33.41 million. On a quarterly basis basis, 2Q net profit and revenue were 21.6% and 8% higher compared to the preceding three months. Kawan Food said its factory in China was expected to start operations in 3Q this year and contribute positively to the group’s earnings. “The group will continue to stay focused to maintain its leadership in the frozen ready-to-serve (RTS) segments. Competition in the RTS segments is expected to intensify. “Overall, the board is of the opinion that sales revenue growth for 2009 is expected to be satisfactory,” Kawan Food said. More than half of its revenue in 2Q was derived from overseas sales across Asia, Oceania, Africa, Europe and North America. The company’s transactions abroad are mostly done in the US dollar. Shares of Kawan Food rose 3.5 sen or 4.6% to close at 79 sen yesterday, valuing the company at RM94.8 million. The stock had risen 12.86% this year, underperfoming FTSE Bursa Malaysia KLCI’s rise of 33.34%. This article appeared in The Edge Financial Daily, August 18, 2009.
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