MBSB’s shares rise as earnings beat forecast – Business News

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KUALA LUMPUR: Malaysia Building Society Bhd (MBSB)’s shares rose 4% in early trade Friday, after its fourth quarter earnings came in ahead of estimates.


The lender saw its shares gained 4.27%, or 0.5 sen to RM1.22.


MBSB’s net profit almost tripled in the fourth quarter ended Dec 31, 2017 (4QFY17) thanks to lower cost of funds and lower allowances for impairment losses.


Its net profit stood at RM123.9mil for 4QFY17, up 172% from RM45.6mil a year ago. Revenue was slightly lower at RM818.2mil, against RM819.4mil a year earlier.


MBSB announced a single-tier final dividend of five sen per share for the financial year ended Dec 31, 2017 (FY17).


MIDF Research said MBSB’s results came in above the house and consensus expectation, accounting for 106.5% and 119.5% of full year estimates.


Cumulatively, the group’s net earnings grew by a whopping 107.1% year-on-year.


“Despite the results came in above our expectations, we are maintaining our FY18 forecast as we have taken into account the reduction of impairment allowance as well as improving net income.


“We introduce our FY19 earnings forecast, which will reflect MBSB’s full year earnings projection as a full-fledged Islamic banking,” MIDF said.  


The research house remained optimistic on the group’s performance moving forward, supported by the current and future initiatives being planned and executed.


“On the group’s outlook, we are positive on the group’s creation of delivery channels, which will help in new customer acquisition as well as driving down operational expenses.


“Given this optimistic stance, we maintain our ‘buy’ call on the stock with a target price of RM1.50. This is pegging its FY18 BVPS to PBV of 1.1x,” MIDF said.



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