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THURSDAY JULY 26, 2018 • THEEDGE FINANCIAL DAILY

Malaysia Airlines Westports 2Q profi t down;

group pays 5.4 sen dividend
evaluating funding BY SUPRIYA SURENDRAN volume to 61% in 1HFY18.

For conventional cargo, Westports
KUALA LUMPUR: Westports handled a total throughput of 5.3
for nine 737 MAX jets 18.1% to RM121.81 million in the recorded in the break-bulk segment.
Holdings Bhd’s net profit fell million tonnes, with a higher volume
Westports group managing di-
second quarter ended June 30,
2018 (2QFY18) from RM148.82 rector Datuk Ruben Emir Gnana-
million a year ago, as a result of lingam said the container shipping
higher depreciation and fi nance industry experienced major rea-
costs during the current quarter lignment changes in the previous
following the completion of Con- year, especially with the formation
Carrier is assessing all available options at this stage — CEO tainer Terminal 8 (CT8) and CT9, of new global alliances, as well as
and the absence of an investment mergers and acquisitions among
tax allowance that was previously the container shipping lines.

BY FOO KHAI YEE & WONG EE LIN comment, so it is best that we allow claimed in 2QFY17. “These changes have adversely

Mavcom to do their analysis.” Earnings per share came in affected our trans-shipment volume,
KUALA LUMPUR: Malaysia Airlines Last week, Transport Minister lower at 3.57 sen for 2QFY18 com- but Westports has transitioned suc-
Bhd is evaluating jet fi nancing as Anthony Loke Siew Fook was re- pared with 4.36 sen for 2QFY17. cessfully towards serving the new
an option for the purchase of nine ported as saying that Mavcom was Quarterly revenue also services under the Ocean Alliance.
Boeing 737 MAX planes, in its fi rst fi nalising its study on a suitable dropped 21% to RM394.04 mil- “Based on Westports’ overall
approach to lenders since a restruc- mechanism to control domestic lion from RM501.44 million in improving container volume mo-
turing exercise three years ago. airfares and that a solution is ex- 2QFY17, due to adoption of the mentum, we are at the tail end of
“At this stage, Malaysia Airlines pected at the end of the month. Malaysian Financial Reporting establishing a new volume baseline,
is evaluating [all available] options, Yesterday, Malaysia Airlines signed Standard 15 accounting stand- from which we can establish future
whether we want to fund it ourselves a one-year agreement with four um- ards from Jan 1. growth levels,” he said.

or get financing,” group chief execu- rah tour operators — KRS Travel Sdn Nevertheless, the group de- On its container terminal expan-
tive officer (CEO) Captain Izham Is- Bhd, ATS Global Travel & Charter, clared a first interim dividend of sion, Ruben said the completion of

mail told reporters at a press confer- Ecoriths Leisure Travel & Tour, and 5.4 sen per share amounting to CT8 and CT9 in 2017 had increased
ence yesterday, adding that a lease Rayhar Travels Sdn Bhd — to provide RM184.1 million for FY18 ending Westports’ total container handling
buy-back is also under evaluation. air charter services for the umrah sea- Dec 31, 2018, payable on Aug 20. capacity to 14 million TEUs per year.

Two years ago, Malaysia Airlines son from October 2018 to June 2019. The weaker quarterly per- “The additional capacity is cur-

confirmed orders for 25 737 MAX The total of 149 fl ights operated formance dragged the group’s rently accommodating the larg-
jets with Boeing, on top of an op- by Malaysia Airlines’ Airbus A380- net profit for the cumulative est container vessels of more than
tion for another 25 aircraft, which Izham: Malaysia Airlines is guided by 800 aircraft mark the highest num- six months ended June 30, 20,000 TEUs that call at Westports

the airline has yet to exercise. the MoT and Mavcom on the capping of ber of scheduled flights for the um- 2018 (1HFY18) down 15.2% to and has further strengthened Port
Touching on the impending re- prices. Photo by Kenny Yap rah season to date for Malaysia RM245.61 million from RM289.71 Klang as the pre-eminent port for the
introduction of the sales and servic- Airlines’ charter unit. million a year ago, while revenue nation’s gateway trade and also be-
es tax, Izham said Malaysia Airlines “We are honoured to be selected fell 24% to RM779.13 million from ing one of the main trans-shipment
expects “no impact on consumers” port’s (MoT) proposal to cap do- once again as the preferred carrier RM1.02 billion in 1HFY17. hubs in the region.”

should air tickets be exempted from mestic air ticket prices during the to transport over 70,000 pilgrims In a statement yesterday, West- The group also shared that its
the tax as they were previously. festive periods. “Malaysia Airlines signed up with KRS, ATS, Ecoriths ports said it also handled 4.3% less total outstanding sukuk stood at
“We are still waiting for guidance is guided by the MoT and Mavcom and Rayhar,” Izham said, adding the containers in 1HFY18 at 4.5 mil- RM1.5 billion and the proceeds
from the Royal Malaysian Customs (Malaysian Aviation Commission) agreement is the largest in terms of lion TEUs (twenty-foot equivalent have been used to part-fi nance the
Department,” he said, but declined on the capping of prices. It is still passenger volume for umrah char- units) compared with 4.7 million development of container terminal
to comment on the ministry of trans- [too] early for me to make a detailed ter services. TEUs achieved in 1HFY17. expansion.
Nevertheless, its indigenous The total capital expenditure
cargo rose 20% year-on-year spent on CT8 and CT9 in recent
Malaysia welcomes enhanced cooperation (y-o-y) in 1HFY18, reflecting years is more than RM1.7 billion.
favourable domestic economic

With regard to tariffs imposed by
activity growth. some major trading nations, Ruben
with EU over anti-palm oil campaign segment showed continued fa- flows. “However, after some initial
Westports said the intra-Asia said they could affect global trade

vourable momentum with a dislocations, a new equilibrium

BY TAN XUE YING The ministry added that Malay- who are constantly fed streams of growth of 10% y-o-y, thus rais- would emerge, and trade between
sia has consistently narrated the anti-palm oil messages without ing the trade lane’s contribution nations will still be the preferred

KUALA LUMPUR: Malaysia is open nation’s commitment to maintain- full verification of the underlying to Westports’ overall container paradigm for growth.”
to enhanced cooperation with the ing at least 50% of its land under facts and the French ambassador’s
European Union (EU) over the is- forest and green cover, and sub- statement simply re-echoes such
sue of palm oil production and the scribing to nationwide production sentiments,” the ministry said.
negativity surrounding deforest- of certifi ed sustainable palm oil Last week, Laplanche report- Maybank IB issues 15 call
ation, and to promote inclusive through the Malaysian Sustain- edly said that “public opinion re-
growth for all, the newly formed able Palm Oil certifi cation being garding palm oil in the EU is still warrants, one put warrant
ministry of primary industries said made mandatory. negative due to concerns over

yesterday. This is on top of Malaysia em- climate change, environmental
The ministry’s statement came bracing the concept of the United protection and biodiversity con- BY SYAHIRAH SYED JAAFAR issue size of 100 million each.

after French Ambassador to Malay- Nations Sustainable Development servation”. “The structured warrants issued
sia Frederic Laplanche reportedly Goals of 2030 that balances out so- “We would certainly welcome KUALA LUMPUR: Maybank In- in this tranche are primarily a reissu-
suggested in a media interview that cial and economic progress with the the French ambassador to work vestment Bank Bhd (Maybank IB) ance of structured warrants that have
both Malaysia and the EU should environment. with us and help create a larger has issued 15 new cash-settled either expired or are expiring soon.
work towards a solution in light of Furthermore, the total oil palm platform to rebalance the negative call warrants over shares in Bumi “This issuance covers key sec-

the negative sentiments surround- planted areas in Malaysia in 2017 — narration around palm oil in the Armada Bhd, Eco World Develop- tors of the economy including the
ing deforestation issues caused by 5.81 million hectares — accounted EU,” said the ministry. ment Group Bhd, Gamuda Bhd, construction, property, manufac-
palm oil production. for a mere 0.11% of the total global “Also, Malaysia is open and will- Globetronics Technology Bhd, turing and oil and gas sectors, with

“The ministry of primary indus- agricultural area, according to the ing to collaborate with our friends Hengyuan Refining Co Bhd, IJM additional warrants issued over the
tries notes the views and concerns ministry. in Europe, to create greater con- Corp Bhd, Inari Amertron Bhd, benchmark index,” it added.
of Laplanche on the issue of nega- Malaysia is also committed to sumer awareness of sustainable MyEG Services Bhd, Sime Darby While Maybank IB Research has
tive public opinion by EU consum- stabilising the orangutan popula- palm oil production and the health Property Bhd, Sime Darby Bhd, revised its year-end FBM KLCI tar-
ers of palm oil and welcomes any tion through various conservation benefits of palm oil. Tenaga Nasional Bhd, Unisem get downwards to 1,750 from 1,840

form of collaboration to allay such efforts on the ground, the ministry “Better cooperation between (M) Bhd, VS Industry Bhd, YTL previously, Maybank IB said it ex-

perceptions in the EU. said, which apart from Orangutan Malaysia and the EU over the issue Corp Bhd and the FBM KLCI. pects the market to be rangebound
“Malaysia has always been mind- Appeal UK, it has yet to see visi- of palm oil production may reap Maybank IB also issued one for the second half of the year.

ful of these challenges and has ap- ble contributions from concerned greater benefits in the long term new cash-settled put warrant over The call warrants have gearings

plied best practices including envi- countries and parties. for all parties involved. Malaysia the FBM KLCI. ranging from 2.75 times to 11.2

ronmental impact assessments in “However, these actions still ap- believes the best solution would In a statement, Maybank IB times. The tenure for the 15 call
establishing and operating its palm pear to be inadequate in the eyes be to work together to promote said the call warrants and put war- warrants and one put warrant listed
oil industry,” read the statement. of EU consumers and legislators, inclusive growth,” it added. rant were listed yesterday, with an above is eight months.