16 December 2008 Newz Bits

December 16, 2008 at 1:19 am Leave a comment

HIGHLIGHTS

On Malaysia
· MAS under investigation by New Zealand authorities for price fixing in the freight market
· Astro made a net loss of RM250.4m in 3QFY09
· PAAB to take over all the water assets from the Malacca government
On The Global Front
· Manufacturing in the US slumped further in November
· China’s industrial production grew at the weakest pace in almost a decade
· Sentiment among Japan’s largest manufacturers fell the most in 34 years

Malaysian Airline System Bhd (MAS MK, Hold, TP: under review) is among 13 airlines to be prosecuted by New Zealand’s Commerce Commission for alleged price fixing and long-term cartel behaviour in the freight market. MAS in a statement yesterday confirmed that it was served with a statement of claim by the commission in relation to its air freight investigation. The statement of claim did not indicate any quantum of fines that might ultimately be imposed. (Financial Daily)
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Malaysia Airlines (MAS) (MAS MK, Hold, TP: under review) expects its four new fare options under the MH Value Fares programme to boost ticket sales and revenue going forward. Managing director and chief executive officer Datuk Seri Idris Jala said the new fare choices would either sustain or improve load factor of various routes and increase overall sales. These fare options are available for economy, business and first class travel. The value fares were available for all seats depending on seasonal load factor and would be introduced on international routes by February, he said. However, MAS does not intend to remove its fuel surcharge despite falling fuel prices. The four value fares for economy class – MHlow Fares, MHbasic, MHsmart and MHflex – offer discounts between 20% and 70% depending on the booking period as well as passenger preference. (StarBiz)
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Telekom Malaysia Bhd (TM) (T MK, Hold, TP: RM2.74) yesterday said the High Speed Broadband (HSBB) project worth RM11.3bn required new and complex technologies which were not produced in Malaysia. Only international producers are able to produce and develop the sophisticated equipment with proven systems and therefore it was only reasonable for TM to conduct an open tender process directly to the principal suppliers for the HSBB project. TM also said as the HSBB project will have a significant impact on the country’s future growth, the tender move was to ensure that the project is carried out smoothly with minimum risks and high quality procurement. The company said this in response to a report carried by Bernama yesterday in which the Malay Chamber of Commerce Malaysia (DPMM) had questioned TM’s offer of four packages of tender worth up to RM10bn to foreign suppliers for the HSBB project. (BT)
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Bumiputra-Commerce Holdings Bhd (BCHB MK, Buy, TP: RM8.60), said it will change BankThai pcl’s name and appoint a new chief executive officer (CEO) after completing a mandatory offer to buy shares it doesn’t already own next month. “We will integrate BankThai into our group,” Bumiputra-Commerce CEO Datuk Seri Nazir Razak told a press conference yesterday. “BankThai will be transformed quite extensively. The transformation will take about three years.” The Malaysian lender bought 42% of BankThai last month and agreed to purchase a 37% stake from TPG Inc’s buyout unit. The acquisition of BankThai is BCHB’s latest attempt to expand its foothold in Asia beyond Malaysia, Singapore and Indonesia. (BT)
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Astro All Asia Networks plc made a net loss of RM250.4m from a profit of RM34.02m for 3QFY09 on start up loses in its overseas investments and further provisions in relation to its Indonesian venture. Its earnings before interest, taxes, depreciation and amortisation (EBITDA), excluding the cost and provisions incurred from its Indonesian business, was 6% lower at RM154m as the cost of content and operating expenses grew due to the increase in number of channels. Gross
subscriber additions at the Malaysian pay-TV operations were at new high of 164,000 while net additions were strong at 96,000. (Financial Daily)
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Malaysia’s palm oil exports rose 39% in the first 15 days of December compared with the same period in November, according to independent surveyor Intertek. A total of 868,629 metric tonnes of palm oil were tracked from Dec1-15. (Financial Daily)
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Petrol and diesel prices have been reduced by 10 sen a litre from today. Prime Minister Datuk Seri Abdullah Ahmad Badawi, who made the announcement yesterday, said RON97 petrol will be sold at RM1.80 a litre while RON92 petrol and diesel will be retailed at RM1.70 a litre. Also effective today, the price of subsidised petrol and diesel for fishermen has been slashed by 13 sen a litre to RM1.30 from RM1.43. (Financial Daily)
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Pengurusan Aset Air Bhd (PAAB) has struck its first water deal – to take over all the water assets from the Malacca government. The signing of the agreement is scheduled for tomorrow and it involves Syarikat Air Melaka Bhd (SAMB) handing over three dams and six treatment plants to PAAB. In return for the assets, PAAB will contra off the outstanding loan of over RM700m that SAMB owes the Government. PAAB is a wholly owned unit of Minister of Finance Inc while SAMB is wholly owned by the Malacca government. After handing over the water assets, SAMB will still manage the supply operations in Malacca through a leaseback agreement with PAAB for 45 years whereby it will continue to supply water to its customers in the state. Under the leaseback agreement, SAMB would have to pay PAAB about RM2.2m every month, sources said. But PAAB
will undertake any future capital expenditure incurred. SAMB is said to be able to generate average revenue of RM10.2m every month. (StarBiz)
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The Real Estate and Housing Developers’ Association Malaysia (REHDA) yesterday urged the authorities to reconsider the proposal to impose immediate blanket ban of hillside development projects following the recent Bukit Antarabangsa landslide tragedy. REHDA president Datuk Ng Seing Liong said the tragedy was unfortunate but a blanket ban would not be the best solution to the problem. According to REHDA, it is necessary for an urgent plan of action to be taken that addresses not only the immediate crisis, but also the longer term issues of sustainable development that includes the protection of hill slopes and the environment. According to him, blanket banning and freezing of all hill slope development is not a sustainable long-term answer. A blanket ban affects many landowners and developers with a value writedown that will affect their balance sheet, he said. (BT)
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Terengganu’s own wealth fund, a RM10bn fund to be managed by the Terengganu Investment Authority (TIA), will acquire some of the assets owned by the state. It is learnt that the Terengganu state government would, in turn, use part of the proceeds from the disposal of assets (to TIA) to repay loans due to the federal government. The oil-rich state has a slew of both listed and unlisted assets. The listed companies, held by its investment arm Terengganu Incorporated Sdn Bhd, are Eastern Pacific Industrial Corporation Bhd (EPIC), TDM Bhd and Golden Pharos Bhd. Among the unlisted assets are Syarikat Air Terengganu Sdn Bhd and several parcels of land that have been partially developed. Among the assets, EPIC is closely watched as the company is involved in the oil and gas industry and port services. EPIC also owns the Kemaman Supply Base,
a leading petroleum supply base located within the Petroleum Development Zone in Kemaman, Terengganu. (StarBiz)
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Toyota Malaysia has exceeded its sales target of 90,000 vehicles and is set to end the year with more than 95,000 units sold, said a company official. UMW Toyota Motor Sdn Bhd’s managing director Kuah Kock Heng said the company was unable to announce 2009 sales projections as it was still in discussions with the Malaysian Automotive Association to finalise total industry volume (TIV) figures. He said overall TIV is expected to come down next year. (Financial Daily)
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Perusahaan Otomobil Kedua Sdn Bhd (Perodua) managing director Datuk Syed Abdul Hafiz Syed Abu Bakar said industry players would spend less and delay new launches because of the depressed market. Hafiz, nevertheless, said the planned launch of Perodua MPV (multi-purpose vehicle) in 4Q08 remains on track. The new MPV from Perodua is widely anticipated after Proton Holdings Bhd’s own MPV slated by March next year. Given the expected shrinking overall car sales in 2009, Hafiz expects a modest sales target of less than 3,000 units of Perodua MPV a month. Meanwhile, Perodua is spending about RM60m to install seat belts for rear passengers in its cars. Hafiz said the high cost is inevitable as it involves 435,000 units of Perodua cars like the Kancil, Kelisa, Kenari, Kembara and Rusa. More recent models like the Myvi, Viva and Nautica
are already fitted with the belts. (BT)
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Stocks slipped Monday amid worries about the automakers, questions about the Bernard Madoff scandal and anticipation of today’s rate-cut decision from the Federal Reserve. The DJIA lost around 65 points, or 0.8% to close at 8,564.5. The S&P 500 index fell 2.2% (-19.9 pts, close 868.6) and the Nasdaq composite declined by 2.1% (-32.4 pts, close 1,508.3). In currency
trading, the dollar fell to an 8-week low versus the euro and hovered near a 13-year low against the yen. US light crude oil for January delivery fell US$1.77 to settle at US$44.51 a barrel on the New York Mercantile Exchange. (CNNMoney)
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Manufacturing in the US slumped further in November as exports tumbled and automakers slashed their assembly rate to the lowest level in more than 18 years. Industrial production fell 0.6%, the third drop in four months, the Federal Reserve said yesterday. The New York Fed reported the weakest factory performance in its region this month since its survey began in 2001. Yesterday’s figures may intensify pressure on the Bush administration to prevent a collapse of General Motors Corp. As consumer demand slides with higher unemployment and a cut-off of credit, manufacturing is poised to keep contracting into 2009, economists said. (Bloomberg)
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China’s industrial production grew at the weakest pace in almost a decade as export growth collapsed, increasing pressure on the government to do more to revive the slumping economy. Output rose 5.4% y-o-y in November, the statistics bureau said yesterday. (Bloomberg)
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Sentiment among Japan’s largest manufacturers fell the most in 34 years, signalling companies are likely to cancel spending plans and cut more jobs, pushing the economy further into recession. An index that measures confidence among large makers of cars and electronics dropped to minus 24 from minus 3, the Bank of Japan’s quarterly Tankan survey showed
yesterday. Job cuts by companies including Sony Corp and Toyota Motor Corp have brought the recession home to households and increased the risk of a prolonged slump. (Bloomberg)
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Vietnam says it will increase a previously announced billion-dollar economic stimulus package to almost US$6bn (US$1 = RM3.57). The package, to be unveiled later this month aims to revive the slowing economy with tax cuts as well as spending on infrastructure, housing, schools and hospitals, Deputy Prime Minister Nguyen Sinh Hung said. (BT)
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December 15, 2008 Daily Highlights December 16, 2008 Daily Highlights

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