InvestIdeas

not vested

Jan 28, 2020

Hume: En-route to earnings recovery in 2020.

Based on bulk cement ASP of RM235/tonne, most cement companies should be profitable.

For Hume, we have factored in a cement ASP of RM230/tonne for FY20.

If cement ASP rises faster than expected to RM250/tonne in FY20, our FY20 net profit forecast for Hume will increase to RM38.8m (from RM6.4m) and our target price will rise to RM2.00 (from RM1.45).

We have also pencilled in cement ASP of RM260/tonne and RM270/tonne for FY21-22 respectively.

Source: UOBKH

not vested

Hume Industries (HUME MK)
Earnings Upswing

Hume is on track for a major earnings turnaround following recovery in both bulk and bag cement prices.

Based on our channel checks, its bulk cement ASP has been officially raised to RM240-250/tonne in early-February following the trend set by industry leader.

We have also assumed a lower breakeven ASP, partly reflecting lower coal costs, while utilisation rate has been healthy.

Maintain BUY with a higher target price of RM2.20 (from RM1.45) post-earnings revision.

Source: UOBKH

https://research.uobkayhian.com/content ... 581f28f506

not vested

Hume Industries (HUME MK/BUY/RM1.54/Target: RM2.20).

We had recently raised our target price from RM1.45 to RM2.20 as we lowered our breakeven ASP assumption from RM230/tonne to RM210/tonne.

Our target price is based on 18x PE (4-year historical average) and 2020F fully diluted EPS and bulk cement ASP of RM240/tonne.

In a blue skyscenario, if bulk cement ASP reaches RM260/tonne, our target price would be RM3.50.

Source: UOBKH

not vested

Hume Industries (HUME MK/BUY/RM1.01/Target: RM1.40).

We revised our earnings in view of slower expected sales volume growth during the MCO period which has essentially curtailed production for one month.

Our target price has been reduced to RM1.40 post our earnings forecast revision (previously RM2.20), based on 18x PE (4-year historical mean PE).

We arrive at a trough target price of RM0.55 based on 6.7x PE, which is -1SD below mean,
during the 2008 financial crisis.

Source: UOBKH

not vested

Hume Industries (HUME MK/BUY/RM1.26/Target: RM1.40).

We lowered our earnings forecasts in view of slower-than-expected sales volume growth during the MCO period which has curtailed production for one month.

Our target price has been reduced to RM1.40 post our earnings revision (previously RM2.20), based on 18x 2020F PE (4-year historical mean PE).

Our trough target price is RM0.55, based on 6.7x PE, which is the PE multiple during the 2008 financial crisis, and is -1SD below historical average PE.

Source: UOBKH

not vested

Hume Industries returns to black in Jan-March quarter

KUALA LUMPUR, May 18 — Building materials producer Hume Industries Bhd swung to a net profit of RM1.81 million for the third quarter (Q3) ended March 31, 2020, from a loss of RM24.19 million a year earlier.

The improvement was mainly due to the cement business contribution, thanks to lower rebate of cement selling price, said the company in its quarterly results announcement.

Revenue also increased to RM177.37 million from RM152.08 million the year-ago period, it said.

“The Movement Control Order (MCO) imposed by the Malaysian government as a result of controlling the spread of the Covid-19 virus on March 18, 2020, impacted the group’s businesses for the quarter under review as a full suspension of operations was imposed nationwide,” Hume said.

On its prospects, it said the board expected the unprecedented situations caused by the Covid-19 pandemic to have an adverse impact on the group’s businesses.

In early May, the group was granted permission by the International Trade and Industry Ministry to resume partial operations.

“The management is currently assessing the market situation to gradually step up productions. As such the board has decided to suspend all views on the prospects of the group’s until such time that the overall impact of the Covid-19 pandemic on the group becomes cleaner.

“In the meantime, the management’s focus is to conserve cash within the businesses. All senior managers have agreed to a voluntary reduction in base salary and devised ways to adapt to the new norm in business practices,” it said.

Hume’s board did not recommend any dividend for the quarter under review, and no dividend has been declared for the financial year to-date.

Source: Bernama

https://www.malaymail.com/news/money/20 ... er/1867438

vested

1H, 2020 Results

Revenue: -8%
EPS: -9.28
NAV: 0.80

https://www.bursamalaysia.com/market_in ... id=3080826

vested

2Q Results

Revenue: +0% yoy
EPS: 0.07 from -1.52
NAV 0.79
Cash RM 93m

https://www.bursamalaysia.com/market_in ... id=3132196

vested

1Q, 2021

Revenue: -9%
Losses: - RM 11.9m
NAV: RM 0.76

https://www.bursamalaysia.com/market_in ... id=3160418

vested

4Q, 2021

Revenue: +43%
Losses: RM 17.4m vs RM 16.4m
NAV: RM 0.73
Cash: RM 50.5m

https://www.bursamalaysia.com/market_in ... id=3193149