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Singapore stock market and companies daily report (United Overseas Bank’s, KSH Holdings) (August 11, 2010)

Contributed by Shares Investment

By Shares Investment

US Stocks Trim Losses On Fed’s Stimulus
The Dow Jones Industrial Average fell 0.5% to 10,644.25, after being down nearly 150 points earlier, after the Federal Reserve said it plans to buy government debt in an effort to buoy the economy. The S&P 500 lost 0.6% while the Nasdaq dropped 1.2%. Earlier in the day, an economic report out of China which showed a slowdown in the pace of property-price gains and import growth, rattled the markets, particularly materials. The Federal Reserve held interest rates steady, as widely expected, and said economic growth would likely be “more modest” than previously expected. Meanwhile, gold turned higher, ending above US$1,200, as it benefited from the renewed economic uncertainty. Oil fell to settle at US$80.25 per barrel amid concerns over the slowing US economic recovery and a slide in China’s imports.

UOB 2Q10 Net Profit Up 28%, Slightly Ahead Of Estimates
United Overseas Bank’s (UOB) net profit grew 28% YoY to $602m in 2Q10 due to a sharp drop in bad-loan charges. But revenue from its main lending business dropped, as the group took a cautious approach to making new loans, while loan margins were hurt by intensifying competition among banks. Net interest income fell 3% to $884m. Trading and investment income also fell sharply as non-interest income slid 31% to $382m. Impairment charges for loans and other assets fell to $52m from $465m a year earlier and $108m in 1Q10. For 1H10, UOB’s net profit was $1.3b, up 48% YoY. UOB’s asset quality continued to improve with non-performing assets declining further to $2.5b and its non-performing loans ratio dropping to 1.9%.
Significance: With key regional markets recording strong loans growth, UOB will sharpen its focus in its key Asian markets and continue investments to build an integrated regional platform.

KSH Records 54% Jump In 1Q11 Profits To $4.2m
KSH Holdings (KSH) posted a 54% YoY leap in net profit to $4.2m for 1Q11. Revenue was also up 21% at $72.4m, propelled by its construction segment. A 54% drop in finance costs to $625k also helped to boost its net profit. But EPS fell to 1.44 cents from last year’s 1.49 cents because of a bigger share capital base. KSH’s core construction segment contributed $71m to total revenue – up by 21% YoY attributable to ‘new projects and other ongoing projects that have progressed into advanced stages of construction’. It had an order book of more than $312m as at June 30. Rental income from investment properties rose 19% to about $1.3m, while rental income from development property fell 42% to $106k. KSH maintained a healthy balance sheet, with cash and cash equivalents and fixed deposits of $90m.
Significance: Going forward, KSH will be able to capitalise on the expected strong construction demand in Singapore. Coupled with recent contract wins, its order book will likely continue to grow.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.