MY Morning Wrap | Sime Darby Property's 4Q Net Profit Rises 27.25% Thanks to Strong Topline Contributions

The S&P 500 index hit a new all-time high before paring gains as investors reevaluated the rally's extent and whether the momentum driven by $NVIDIA(NVDA.US)$'s blockbuster earnings could be sustained. Seven of 11 sectors gained, led by utilities, materials, and healthcare, while tech stocks wavered. Nvidia and Amazon were the only members of the Magnificent Seven to hold onto gains. The tech-heavy $Nasdaq Composite Index(.IXIC.US)$ slipped 0.3% to 15,996.82, while the $S&P 500 Index(.SPX.US)$ ended little changed at 5,088.8, and the $Dow Jones Industrial Average(.DJI.US)$ gained 0.2% to 39,131.53, a record close.

$SIMEPROP(5288.MY)$: Sime Darby Property reported a 27.25% increase in net profit for the fourth quarter ending December 31, 2023, reaching RM131.26 million from RM103.15 million in the previous year, boosted by strong topline contributions and a higher profit from the property development segment. Quarterly revenue also rose by 5.83% to RM1.01 billion compared to RM956.9 million in the previous year. The company declared a second interim dividend of 1.5 sen per share, bringing total dividends for FY2023 to 2.5 sen per share. For the full year, net profit jumped by 29.15% to RM407.91 million from RM315.84 million in FY2022, with annual revenue expanding by 25.34% to RM3.44 billion from RM2.74 billion. The company is positive about FY2024, with rising sales volumes, new property launches, successful completions, and positive government policies and incentives.

$IOICORP(1961.MY)$: IOI Corp reported a 52.9% year-on-year decrease in net profit for the second quarter ending December 31, 2023, reaching RM335.4 million from RM712.1 million, mainly due to a lower contribution from the resource-based manufacturing segment. Revenue also declined by 27.46% to RM2.4 billion compared to RM3.3 billion in 2QFY2023. The company declared a 4.5 sen dividend for the quarter. For the first half of FY2024, IOI's net profit dropped by 27.3% to RM639.4 million from RM879.6 million as revenue fell 34.01% to RM4.6 billion from RM6.97 billion. The company anticipates a moderate increase in CPO price to levels close to or above RM4,000 a tonne in March and April due to the anticipation of higher palm oil consumption.

$Telekom Malaysia FEB4(FTEL2402.MY)$: Telekom Malaysia reported a more than double increase in net profit for the fourth quarter ending December 31, 2023, reaching RM433.53 million from RM160.18 million a year ago, thanks to tax credits, higher data revenue, and lower costs. Revenue for the quarter also rose by 5% year-on-year to RM3.12 billion from RM2.98 billion, mainly due to an increase in data, internet, multimedia services, and other telecommunication services. The company declared a final dividend of 15.5 sen per share. For the full year, net profit surged by 64% to RM1.87 billion from RM1.14 billion, thanks to lower net finance costs and recognition of tax credits from unutilised tax losses. For 2024, the company is targeting "low single-digit" growth in revenue and earnings before interest and tax between RM2.1 billion and RM2.2 billion.

$MATRIX(5236.MY)$: Matrix Concepts Holdings announced a 5.27% increase in net profit for the third quarter ending December 31, 2023, reaching RM57.24 million from RM54.37 million in the previous year, as gross profit margin improved due to changes in the product mix. Despite the absence of revenue contribution from the group's Australian and Klang Valley property development activities, revenue declined by 18.64% to RM295.98 million compared to RM363.81 million previously. For 9MFY2024, Matrix's net profit grew by 22.3% to RM185.87 million from RM151.98 million, as revenue expanded by 21.01% to RM986.76 million from RM815.42 million a year earlier. The company's recent acquisition of a 1,382-acre land parcel within the Malaysian Vision Valley corridor is expected to position the group to cater to the thriving housing demand in Seremban and capture the spillover effect from buyers seeking alternatives to the Klang Valley market.

$MALAKOF(5264.MY)$: Malakoff Corp reported a net loss of RM357.1 million in the fourth quarter ending December 31, 2023, compared to a net profit of RM41.9 million in the previous year, due to the group's independent water and power producer (IWPP) associate in Bahrain. Quarterly revenue fell by 23.89% to RM2.26 billion from RM2.97 billion, caused by lower energy payment for the Tanjung Bin Power power plant and an absence of revenue from GB3, whose power purchase agreement expired on December 30, 2022. For FY2023, Malakoff reported a net loss of RM884.36 million compared to a net profit of RM255.03 million in FY2022, with 12.4% lower revenue of RM9.07 billion. The company is actively participating in competitive bids for solar projects initiated by the government while remaining open to potential mergers and acquisitions in the waste management and environmental solutions sector.

$MI(5286.MY)$: Mi Technovation announced a 30.36% decline in net profit for the fourth quarter ending December 31, 2023, reaching RM11.92 million compared to RM17.11 million in the previous year, mainly due to a lower utilisation rate. Revenue for 4QFY2023 also slipped by 17.53% to RM96.62 million from RM117.15 million previously. The company declared a dividend of two sen per share. For FY2023, the group reported a net profit drop of 19.83% to RM55.2 million from RM68.86 million in FY2022, as its margins were compressed by "huge" foreign exchange losses. Full-year revenue slipped by 8.61% to RM355.96 million from RM389.48 million previously. Despite this, the group remains optimistic about the semiconductor equipment business unit's revenue contribution in FY2024.

$AEON(6599.MY)$: Aeon Co (M) Bhd announced a 31% increase in net profit for the fourth quarter ending December 31, 2023, reaching RM32.58 million compared to RM24.91 million in the previous year, thanks to a higher occupancy rate, rental renewals, and cost control. However, quarterly revenue slipped by 2.68% to RM1.03 billion from RM1.06 billion, due to lower retail sales and a high base of comparison. For FY2023, the company's net profit increased by 3.24% to RM114.83 million from RM111.23 million. Revenue slipped by 0.29% to RM4.13 billion from RM4.14 billion in the previous year, due to a high base of comparison last year and partial store closures for renovation. The company proposed a dividend of four sen per share for FY2023. Aeon Co (M) Bhd raised concerns over upcoming subsidy rationalisation, a hike in services tax, and the introduction of high-value goods tax.

$GREATEC(0208.MY)$: Greatech Technology Bhd announced a 12.8% increase in net profit for the fourth quarter ending December 31, 2023, reaching RM41.55 million compared to RM36.82 million, despite its revenue falling by 8.6% to RM154.64 million from RM169.11 million due to lower revenue recognised from its production line system. For FY2023, the company's net profit climbed 17% to RM154.37 million from RM131.89 million in the previous year, while its full-year revenue rose by 20.6% to RM658.75 million from RM546.21 million a year earlier. The company is encouraged by the resilience and ongoing investment interest displayed by its global customers, particularly within the life science, e-mobility, and solar industries.

$SPTOTO(1562.MY)$: Greatech Technology Bhd announced a 12.8% increase in net profit for the fourth quarter ending December 31, 2023, reaching RM41.55 million compared to RM36.82 million, despite its revenue falling by 8.6% to RM154.64 million from RM169.11 million due to lower revenue recognised from its production line system. For FY2023, the company's net profit climbed 17% to RM154.37 million from RM131.89 million in the previous year, while its full-year revenue rose by 20.6% to RM658.75 million from RM546.21 million a year earlier. The company is encouraged by the resilience and ongoing investment interest displayed by its global customers, particularly within the life science, e-mobility, and solar industries

$SAM(9822.MY)$: SAM Engineering & Equipment (M) Bhd announced a 52.81% increase in net profit for the third quarter ending December 31, 2023, reaching RM29.32 million compared to RM19.19 million a year earlier, thanks to higher profit contribution from both its equipment and aerospace segments. Quarterly revenue also grew by 11.54% to RM387.28 million from RM347.21 million in 3QFY2023, on increased sales and forex gains. For 9MFY2024, the company's net profit rose by 18.41% to RM82.48 million compared to RM69.66 million in 9MFY2023, as revenue increased slightly by 1.45% to RM1.12 billion from RM1.11 billion. The group noted that the semiconductor equipment industry is witnessing a recovery in sales, but fabrication utilization was low at about 70% in the second half of 2023.