GAMUDA (BUY) - 2Q lifted by land sale

GAMUDA (BUY)

2Q lifted by land sale

• Reported 2HFY11 PATAMI grew by 47% to RM268.8m (13 sen/share). However, after adjusting for a one-off gain of ~RM18m from land sales to AEON, core earnings grew by 37% to RM250.8m (12.1 sen/share), meeting both ours and consensus estimates respectively.
• QoQ, core earnings actually dipped due to lower property contribution and fluctuation in contributions from Gamuda Water and SMART. However, in terms of YoY, quarterly earnings grew by 26%, driven by margins expansion for the EDTP project and property activities in Bandar Botanic and Horizon Hills.
• Gamuda has ~RM5.8bn order book, translating to 3.1x FY11’s construction revenue and unbilled sales to RM1.3bn, translating to 1.8x FY11’s property revenue.
• Maintain BUY with TP of RM4.41.

Source: HLIB Research - 29 March 2012