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Categories
| Glomac up in early trade |
| Business & Market 2009 | |||
| Written by Surin Murugiah | |||
| Thursday, 25 June 2009 09:52 | |||
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In a filing to Bursa Malaysia yesterday, the company said the higher earnings were underpinned by recognition of revenue from the sale of Glomac Tower and the fair value gain for Wisma Glomac 3. AmResearch Sdn Bhd has maintained its hold rating on Glomac with higher fair value of 76 sen based on a 50% discount to its estimated net asset value of RM1.50 per share. It said Glomac's FY09 earnings of RM32 million was in line with its own and street's estimates of RM31 million. Going forward, earnings for FY10F and FY11F will be underpinned by continued recognition of its progress billings from enbloc sale of Glomac Tower, said AmResearch. "Sub-structure should be completed in August this year and tender for building works is being finalised. Current unbilled sales for Glomac Tower as at end of April - RM176 million from total unbilled sales of RM364 million (one time its FY09 revenue)," it said. "We estimate earnings to decline 5% year-on-year to RM31 million in FY10F and to grow 4% in FY11F to RM32 million. Earnings for FY10F and FY11F should be driven by step-up in progress billings from development projects of Glomac Tower and Glomac Damansara. We are introducing FY12F earnings at RM43 million." The research house said Glomac's current balance sheet was relatively healthy with net gearing of 12% of shareholder's funds (as at end of April 09) versus 29% in the preceding quarter. "Currently Glomac is trading at a steep discount of 50% to our estimated NAV of RM1.50 and we believe Glomac would continue to be trading at such a steep discount given the lack of re-rating catalyst," it said.
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