Download Media Prima Berhad

24 February 2017 | 4Q16 Results Review
Upgrade to NEUTRAL
Media Prima Berhad
(previously SELL)
Revised Target Price (TP): RM1.10
(Previously RM0.78)
Outperformed expectations
INVESTMENT HIGHLIGHTS
RETURN STATS
•
The group performed better than expected in FY16
•
Out-of-home segment is the main earnings contributor
Price (23rd February 2017)
RM1.05
•
Attractive dividend yield of more than 7.5%
Target Price
RM1.10
•
Upgrade to NEUTRAL with a revised target price of RM1.10
Expected Share Price Return
+4.8%
Expected Dividend Yield
+7.5%
per share
Higher 4Q16 profit. Media Prima Bhd (MPB) reported 4Q16 earnings
of RM5.0m. After adjusting for exceptional items amounting to
+RM36.0m,
MPB’s
normalised
earnings
came
in
at
RM41.0m
Expected Total Return
+12.3%
(+31.3%yoy). The bulk of the exceptional items pertained to start-up
cost of new initiatives which are currently in period of gestation (RM30.7m).
Better than expected. Despite the improvement in 4Q16 normalised
earnings, full year FY16 normalised earnings was down by -41.4%yoy
to RM82.2m. This is after adjusting for exceptional items amounting to
RM141.4m, which mainly consist of restructuring expenses (–RM97.9m)
and start-up costs of new initiatives (-RM43.4m). The drop in earnings
was mainly attributable to poor performance from the print media and
television network (TVN) segments. Nonetheless, the results came in
better than our and consensus expectations, accounting for 159.3%
and 112.4% of full year FY16 earnings forecasts respectively.
Dividend. In 4Q16, the group declared dividend of 4sen per share.
This led to full year FY16 dividend declared of 8sen per share. In
STOCK INFO
KLCI
Bursa / Bloomberg
Board / Sector
1,704.48
4502 / MPR MK
Main/ Media
Syariah Compliant
Yes
Issued shares (mil)
1,109.2
Par Value (RM)
1.00
Market cap. (RM’m)
1,164.7
Price over NA
0.9x
comparison, MPB has declared dividend of 10sen per share in FY15.
52-wk price Range
RM1.00 – RM1.54
Impact on earnings. We are revising upwards the earnings
Beta (against KLCI)
0.60
3-mth Avg Daily Vol
1.7m
contribution from radio and out-of-home (OOH) segments. In addition,
we are now expecting the TVN segment to contribute positively to the
group’s bottomline. All in, we increased our FY17 earnings by +39.2%.
3-mth Avg Daily Value
Target price. Following our earnings revision, we derive a revised
Major Shareholders (%)
target price of RM1.10sen per share (previously RM0.82sen per
share). Our target price assumption is based on FY17EPS of 7.6sen
against its 5-year historical average PER of 14.5x.
RM1.8m
EPF
13.09
Amanah Raya Bhd
11.09
Altima Inc
7.96
MIDF RESEARCH is a unit of MIDF AMANAH INVESTMENT BANK
Kindly refer to the last page of this publication for important disclosures
MIDF RESEARCH
Friday, 24 February 2017
Upgrade to NEUTRAL. Despite challenging market environment, the group has performed above our expectation.
The TVN segment, which we initially viewed to be loss-making, has managed to remain profitable. In addition, we
expect the OOH segment to deliver better earnings perform better due to additional earnings contribution from the
MRT project. This would help to provide some support to the ailing print segment. Due to the share price weakness,
we belief the stock has an attractive dividend yield of more than 7.5%, supported by its healthy cash position. All
factors considered, we upgrade the stock to NEUTRAL from SELL previously.
INVESTMENT STATISTICS
FYE 31st Dec
FY15
FY16
FY17F
FY18F
Revenue (RM’m)
1427.7
1289.0
1344.6
1394.9
Reported EBIT (RM’m)
209.1
-56.9
102.7
111.0
Reported Pretax Profit (RM’m)
200.1
-65.9
101.1
116.0
Reported Net Profit after MI (RM’m)
138.7
-59.2
86.0
98.7
Normalised Net Profit after MI (RM'm)
140.2
82.2
86.0
98.7
Normalised EPS (sen)
12.6
7.4
7.6
8.8
Normalised EPS growth (%)
0.6
-41.4
3.1
14.7
PER(x)
8.3
14.2
13.7
12.0
Net Dividend (sen)
10
8
8
9
Net Dividend Yield (%)
9.5
7.6
7.6
8.6
Source: Company, MIDFR
DAILY PRICE CHART
Martin Foo Chuan Loong
[email protected]
+603 2173 8354
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MIDF RESEARCH
Friday, 24 February 2017
MEDIA PRIMA: 4Q16 Results Summary
(All in RM'm unless stated otherwise)
Quarterly Results
Cumulative
FYE 31st Dec
4Q16
% YoY
% QoQ
2016
2015
%
Revenue
318.6
-13.2
0.6
1289.0
1427.7
-9.7
EBITDA
30.4
-63.7
-136.6
51.3
312.1
-83.6
Depreciation and amortisation
-26.0
-1.1
-10.4
-108.2
-103.1
4.9
EBIT
4.4
-92.4
-103.9
-56.9
208.9
-127.2
Finance costs
-3.4
8.5
2.4
-13.3
-15.3
-12.9
Finance income
3.7
1.3
-13.1
14.4
13.7
5.2
Associates income
-9.5
307.9
912.6
-10.1
-7.2
39.3
PBT
-4.8
-108.7
-95.7
-65.9
200.1
-132.9
Taxation
6.7
-128.2
-733.1
-3.9
-61.4
-93.7
PAT
1.9
-94.2
-101.6
-69.8
138.7
-150.3
MI
3.1
nm
nm
10.6
0.0
nm
PATAMI
5.0
-84.3
-104.6
-59.2
138.7
-142.7
Normalised PATAMI
41.0
31.3
-975.3
82.2
140.2
-41.4
Normalised EPS (sen)
3.7
31.3
-975.3
7.4
12.6
-41.4
+/- ppts
+/- ppts
+/- ppts
EBITDA margin (%)
9.5
-13.3
35.8
4.0
21.9
-17.9
Normalised PATAMI margin (%)
12.9
4.4
14.4
6.4
9.8
-3.4
Effective tax rate (%)
138.6
95.9
139.5
-5.9
30.7
-36.5
Source: Company, MIDFR
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MIDF RESEARCH
Friday, 24 February 2017
MIDF RESEARCH is part of MIDF Amanah Investment Bank Berhad (23878 - X).
(Bank Pelaburan)
(A Participating Organisation of Bursa Malaysia Securities Berhad)
DISCLOSURES AND DISCLAIMER
This report has been prepared by MIDF AMANAH INVESTMENT BANK BERHAD (23878-X). It is for
distribution only under such circumstances as may be permitted by applicable law.
Readers should be fully aware that this report is for information purposes only. The opinions contained
in this report are based on information obtained or derived from sources that we believe are reliable.
MIDF AMANAH INVESTMENT BANK BERHAD makes no representation or warranty, expressed or
implied, as to the accuracy, completeness or reliability of the information contained therein and it should
not be relied upon as such.
This report is not, and should not be construed as, an offer to buy or sell any securities or other
financial instruments. The analysis contained herein is based on numerous assumptions. Different
assumptions could result in materially different results. All opinions and estimates are subject to change
without notice. The research analysts will initiate, update and cease coverage solely at the discretion of
MIDF AMANAH INVESTMENT BANK BERHAD.
The directors, employees and representatives of MIDF AMANAH INVESTMENT BANK BERHAD may have
interest in any of the securities mentioned and may benefit from the information herein. Members of the
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MIDF AMANAH INVESTMENT BANK : GUIDE TO RECOMMENDATIONS
STOCK RECOMMENDATIONS
BUY
TRADING BUY
NEUTRAL
SELL
TRADING SELL
Total return is expected to be >15% over the next 12 months.
Stock price is expected to rise by >15% within 3-months after a Trading Buy rating has been
assigned due to positive newsflow.
Total return is expected to be between -15% and +15% over the next 12 months.
Total return is expected to be <-15% over the next 12 months.
Stock price is expected to fall by >15% within 3-months after a Trading Sell rating has been
assigned due to negative newsflow.
SECTOR RECOMMENDATIONS
POSITIVE
The sector is expected to outperform the overall market over the next 12 months.
NEUTRAL
The sector is to perform in line with the overall market over the next 12 months.
NEGATIVE
The sector is expected to underperform the overall market over the next 12 months.
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