KUCHING: Pos Malaysia Bhd (Pos Malaysia) is set to capitalise on Pos Laju’s widespread centres in Malaysia as the group saw a jump in earnings for the first six months of the financial year 2013 (6MFY13) driven by the courier and logistic divisions.
In a research report yesterday by the research arm of Kenanga Investment Bank Bhd (Kenanga Research), Pos Malaysia’s 6MFY13 core net profit was up by 29 per cent year-on-year to RM67 million on the back of a six per cent increase in revenue.
“This was mainly due to higher revenue contribution from its courier and logistic division (up by 15 per cent) coupled with the operating margin improvement from 16 per cent to 23 per cent,” it noted.
Kenanga Research highlighted that the group’s higher revenue was attributable to an increase in the online transaction business.
In addition, higher operating margin recorded for the courier and logistic business (from 12 per cent to 23 per cent) also boosted the group’s core net profit by 12 per cent.
However, the research firm noted, “This was moderated by the RM11 million operating loss from the retail segment due to high staff and depreciation costs together with lower other segment contributions such as from digital certificates and the printing and insertion business.”
Meanwhile, Pos Malaysia’s core net profit for the second quarter of the financial year 2013 (2QFY13) came in at RM30 million which was a decrease of 13 per cent.
The research firm believed the decrease of the group’s 2QFY13 core net profit was caused by higher operating expenses incurred for retail business and the depleting revenue contribution from the mail business.
Nonetheless, based on Pos Malaysia’s higher contribution from the courier business as well as the enhancement in the operating margin due to a higher transaction volume, Kenanga Research remained optimistic on the group’s growth and revised its target price to RM3.90 per share from RM3.70 per share based on discounted cash flow.