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Tuesday, October 25, 2011

NCB - A Slow Quarter (OSK)

NCB’s 9M core net profit of RM95.6m was within our forecasts, representing 82% of our FY11 earnings estimates, owing to higher container yields and growth in its third-party logistics (3PL) business. Although revenue will rise in Q4 spurred by the rush for Christmas shipments and year-end deliveries, this may be offset by higher expenses. As such, we anticipate Q4 earnings to be weaker y-o-y and q-o-q. Elsewhere, the recovery of the global economy remains fragile, which may dent earnings and dividends. Maintain SELL; FV of RM3.12 and earnings unchanged.

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