UOB Reports A 12.4% Jump In 1Q12 Net Earnings
Beating analysts’ estimates, United Overseas Bank (UOB) recorded a net profit of $688 million, up 12.4% from 1Q11’s $612 million and 23.3% from the preceding 4Q11’s $558 million. The results were above the $632 million average forecast of seven analysts polled by Reuters and the $626 million average of seven analysts’ estimates compiled by Bloomberg. UOB attributed its strong performance to higher contributions from all its core businesses. Notably, UOB achieved another record year of net interest income, led by continued growth in loans and improvement in net interest margins. Year-on-year, net interest income grew 14.6 percent to a quarterly record $998 million, driven by loans growth and better margins. Compared to 4Q11, however, the increase was just 2.1 percent, as the bank expanded its loan book more slowly amid the economic uncertainty. UOB’s net interest margin, a measure of how profitable its lending activity is, widened to 1.98 percent in 1Q12, compared with 1.9 percent a year ago and 1.95 per cent in 4Q11, on improved assets mix geared towards higher-yielding loans.
Significance: UOB benefited from a rebound in trading and investment income as market conditions improved. However, as the fundamental issues in the West are yet to be resolved, the bank remains cautious in its outlook for the world economy.
Wilmar’s 1Q12 Net Earnings Decline 33.8%
Asia’s leading agribusiness group, Wilmar International, posted a 33.8 percent decrease in net profit to US$255.9 million despite a 9.8 percent gain in revenue to US$10.5 billion for its first quarter ended 31 March 2012. Despite the strong earnings growth from palm & laurics, consumer products, plantations & palm oil mills, earnings were dragged under by lower oilseeds & grains margins due to the difficult operating environment in China. Similarly, Wilmar’s associates also recorded lower contributions. Nevertheless, the strong volume growth achieved across all its key business segments reflected strong consumption growth and market share gains. As at 31 March 2012, total assets stood at US$39.95 billion while shareholders’ funds grew to US$13.54 billion. Net gearing ratio increased to 1.08x from 0.97x as at 31 December 2011 due to higher net loans and borrowings to meet Wilmar’s working capital and expansion needs.
Significance: Kuok Khoon Hong, Chairman and CEO of Wilmar expects the company’s key business segments, especially palm & laurics, to continue to perform satisfactorily for the rest of the year although oilseeds crushing margin in China is expected to remain challenging due to excess capacity.
IEV Completes Two Turnkey Decommissioning Projects
IEV Holdings announced that its 30 percent associate, IEV (Malaysia) has safely and successfully completed the two turnkey decommissioning projects awarded by Petronas Carigali ahead of schedule. The two projects are worth a total of RM27 million and the scope of work included the provision of engineering, preparation, removal and disposal of two platforms and associated pipelines offshore Sarawak. The two projects have been awarded to IEV in two separate packages but were later integrated and executed in a single campaign. With the completion of these projects, the balance of the total contract sum amounting to approximately RM22 million is expected to contribute to IEV’s revenue in the first half of the financial year ending 31 December 2012.
Significance: The successful completion of the decommissioning projects underscores IEV’s capability and capacity to undertake turnkey projects, especially in the field of decommissioning, adding to its strong portfolio of proven track records since 1997.