Mixed views on Aeon’s FY16 results
KUCHING: Aeon Co ( M) Bhd’s ( Aeon) f inancial year 2016 ( FY16) results have garnered mixed views from analysts, with earnings either coming within or above expectations.
In a filing on Bursa Malaysia, Aeon reported that profit before tax for the financial year ended December 31, 2016 amounted to RM147.1 million, lower than the previous financial year of RM210.8 million.
The group explained that this was due to higher operation costs and interest expense as well as initial costs associated with new store and mall openings.
According to Affin Hwang Investment Bank Bhd ( Affin Hwang), FY16 core net earnings of RM88.7 million came in above the research firm’s but in line with street expectations at 124 per cent and 101 per cent of fullyear estimates.
Affin Hwang noted that FY16 earnings before interest and tax ( EBIT) margin decreased by 1.3 percentage points ( ppts) to 4.7 per cent due to increased operating expenses and initial costs due to new store and mall openings (versus its EBIT margin forecast of 3.7 per cent).
“We also note that the tax rate has shot up by 11.5ppts to 49 per cent, versus our forecast of 43 per cent,” it said.
On the other hand, Aeon’s FY16 net profit of RM75 million was within the research arm of Kenanga Investment Bank Bhd’s ( Kenanga Research) expectation by accounting for 96 per cent of its forecast but below consensus expectation at 85 per cent.
The group’s declared total and final dividend per share ( DPS) FY16 of three sen was also within the research arm’s expectation.