What do the accounts of Bursa's top 100 companies tell us?

TheEdge Fri, Apr 02, 2021 09:00am - 3 years View Original


KUALA LUMPUR (April 2): Among the top 100 companies on Bursa Malaysia by market capitalisation, 55 of them achieved earnings growth year-on-year (y-oy) in the quarter ended Dec 31, 2020 (4Q20).

Other than earnings performance, The Edge takes a look at other financial indicators based on their accounts as at Dec 31, 2020.

According to data from Bloomberg and Asia Analytica, 35 out of the 80 companies we tracked saw improvements in their trailing 12-month operating cash flow in 4Q20. These 80 companies are among the top 100 largest public-listed companies (PLCs) by market capitalisation (cap) on Bursa Malaysia, excluding banks and insurance companies.

Three companies — VS Industry Bhd, Euro Holdings Bhd and DRB-Hicom Bhd — saw their operating cash flow turn positive.

Among the remaining 32 companies, the tremendously strong global demand for rubber gloves last year boosted Supermax Corp Bhd’s operating cash flow by 1,926% and Top Glove Corp Bhd by 1,215%. Meanwhile, steady cash flow generated from its hydrodam in Cambodia lifted Mega First Corp Bhd’s cash flow by 657% in the quarter under review.

On a q-o-q basis, about half or 38 of the 80 companies saw improved operating cashflow in 4Q20, notably Mi Technovation Bhd (+540%) and Sime Darby Property Bhd (+175%).

In terms of net gearing, 27 out of 80 companies tracked were in net cash positions as at 4Q20, with 20 of their net cash positions having expanded compared with a year earlier.

When compared with the preceding 3Q20, 19 out of the 27 companies sitting on the net cash piles saw an increase in their net cash positions.

Of the 53 companies with net debts, nearly half of them or 27 companies pared down their gearing compared with 4Q19, while 32 firms lowered their gearing compared with 3Q20.

This means a total of 54 companies out of 80 companies either managed to increase their cash standing or reduce their borrowings, compared with 4Q19.

62 companies declared dividends in 4Q20, same number as in 4Q19

In 4Q20, 62 companies declared dividends — the same number when compared with a year earlier. This is more than the 41 which declared dividends in 3Q20, indicating perhaps that these companies were more confident about their cashflow and earnings prospects.

Of these 62 companies, 28 companies paid higher dividends than they did in the same quarter a year ago, while eight paid the same amount.

In contrast to the preceding quarter, 51 out of the 62 companies declared higher dividends, while only three paid the same amount.

Bloomberg data also showed that 16 companies out of the top 100 companies have more than 4% dividend yield. UOA Development Bhd topped the list with 8.05%, followed by Malakoff Corp Bhd with 7.99% and Top Glove with 7.84%.

55 of 100 companies achieved better earnings in 4Q20

Bloomberg data showed that more than half or 51 achieved higher profits than a year earlier, while four companies turned profitable, despite the Covid-19 pandemic. Meanwhile, 32 companies managed to remain in the black albeit showing lower profits.

Out of the 51 companies that recorded stronger profit, 25 of them achieved more than 50% y-o-y increase in their net profits, of which 16 of them saw at least triple-digit growth in earnings.

Healthcare stocks continue to shine as star performers in the fourth quarter, led by Supermax, IHH Healthcare Bhd and Top Glove — with at least a whopping 21 times jump in earnings. IHH Healthcare’s earnings were boosted by a foreign exchange gain of RM151.9 million versus a loss of RM162.3 million a year ago, in addition to substantially lower finance and operating costs.

Other companies that saw stellar y-o-y jump in earnings were DRB-Hicom (+262%), IJM Corp Bhd (+190%) and ATA IMS Bhd (+165%), as plantation and technology sectors performed notably well in 4Q20.

Others which also showed notable earnings increase y-o-y were Kuala Lumpur Kepong Bhd (+114%), FGV Holdings Bhd (+78%), IOI Corp Bhd (+66.6%) and Genting Plantations Bhd (+28.1%), while Sime Darby Plantation Bhd turned profitable.

For semiconductor-related firms, six out of eight of them made higher profits y-o-y, led by Inari Amertron Bhd (+140.4%), D&O Green Technologies Bhd (+118.9%), ViTrox Corp Bhd (+79.4%) and Greatech Technology Bhd (+78%). Unisem (M) Bhd turned profitable while only Mi Technovation’s quarterly net profit slid 24.5%.

In 4Q20, eight companies that are in sectors worst hit by the pandemic were loss making, including Malaysia Airports Holdings Bhd and Genting Malaysia Bhd, but only the airport operator suffered a wider net loss on a y-o-y basis.

59 companies’ earnings saw q-o-q improvement  

Among the top 100 companies, 59 saw better performance in 4Q20 compared with 3Q20, while 37 reported poorer performance.

In terms of q-o-q performance, DRB-Hicom saw the best performance with 1,976% increase in earnings, followed by YTL Corp Bhd (+1,145%), MMC Corp Bhd (+194%) and Leong Hup International Bhd (+133%).

Top Glove was the only glove maker in this list to report a doubling of net profit, which grew 102% q-o-q to RM2.38 billion. Still, other glove makers in the list — namely Hartalega (+83.8%), Kossan (+55.6%), Supermax (+34.2%) — all saw solid double-digit earnings growths.

Interestingly, all eight semiconductor-related firms saw improved quarterly earnings, on a q-o-q basis. D&O saw the largest increase of 105.8%, while Mi Technovation recorded the smallest growth of 7.3%.

The content is a snapshot from Publisher. Refer to the original content for accurate info. Contact us for any changes.






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