TANJONG 1Q net down to RM193m

Tanjong plc saw its net profit decline 11% to RM193.4 million for its first quarter ended April 30, 2010 (1QFY11) from RM216.3 million a year earlier. Revenue fell marginally by 3% to RM945.8 million.

Earnings per share stood at 44 sen compared with 47.5 sen a year earlier.

Tanjong’s gross transaction value in 1QFY11 fell marginally by 3% to RM1.26 billion. Gross transaction value represents gross sales proceeds for its numbers forecast operations (NFO) and revenue from other operations.

In its announcement to Bursa Malaysia yesterday, Tanjong said gross sales proceeds from its NFO business decreased to RM506 million from RM530 million due to lower demand for NFO products arising from the introduction of common draw days for special draws. “This, together with additional tax payments on special draws, led to a reduction in the gaming segment’s operating profit by RM15 million from RM62 million to RM47 million,” it added.

Meanwhile, the group’s power generation revenue decreased by 4% or RM27 million to RM666 million in the first quarter mainly due to lower energy billings from Malaysian power plants. “The operating profit of power generation decreased by RM27 million or 10% to RM238 million due to a lower net contribution from the overseas plants of approximately RM15 million (arising mainly from a lower US dollar exchange rate) and the recognition in the corresponding quarter of RM10 million relating to warranty claims received,” Tanjong said.

“In the leisure segment, higher box office revenue arising from better movie titles for TGV resulted in a RM9 million increase in revenue to RM83 million. Leisure operating profit improved by RM8 million due to improved results from both TGV and Tropical Islands.”

It added that TGV reported a RM3 million increase in profit to RM5 million due to improved admissions and spend. Tropical Islands reported an operating profit of RM4 million (compared to an operating loss in the corresponding quarter of RM600,000) due mainly to higher visitor spending.

Tanjong also noted that it has recognised a total net loss of RM22.5 million or 11.6% of the profit after tax of the group for the period ended April 30, 2010 in the hedging reserve in equity arising from fair value changes on interest rate swaps which were marked to market. It added that the loss was not expected to significantly impact the group’s cash flow.

Its net asset per share stood at RM9.26 as at April 30, 2010 compared to RM9.28 on Jan 31, 2010.

Tanjong announced its first gross interim dividend of 20 sen per share.

The stock ended 36 sen lower at RM17.44 yesterday.


This article appeared in The Edge Financial Daily, July 1, 2010.