All smiles for MISC investors


  • Business
  • Thursday, 23 Jan 2003

BY LIEW LAI JING

DESPITE the turbulent years of war, economic cycles and swings in freight and charter rates, an investor who had held shares in the national shipping carrier, Malaysia International Shipping Corp Bhd (MISC), for the last 13 years would still have a reason to smile. 

From an initial investment of RM9,150 for 1,000 shares on Jan 2,1990, the investor now would be looking at a net gain of RM8,285 from the single lot which has doubled. 

The corporate exercises of MISC were a bonus and rights issue in 1990 and another bonus issue in 1994. 

Dividend payments amounted to RM4,910 over the last 13 years, with a minimum gross of 18 sen per share in the early years and rising to a high of 30 sen in the 2002 financial year (FY). 

For those wondering about the dividends for FY1999, MISC changed its year-end during that year from December to March, and the dividend payment was recorded in FY2000. 

Originally set up as a joint venture between the government and a group of private entrepreneurs to boost Malaysia's maritime services, MISC has grown by leaps and bounds in terms of fleet and business. 

The company is involved in the transport of liquefied natural gas (LNG), petroleum, dry bulk, and chemical tanker and container liner services, as well as the haulage, trucking, warehousing and agency businesses. Its non-shipping businesses encompass heavy engineering, marine education and training. 

From 48 in 1990, MISC's fleet has expanded to 124 vessels with a combined capacity of more than 4.6 million deadweight tonnes. 

As for revenues, the figure has more than tripled to RM5.5bil in 2002 from RM1.6bil in 1990. 

MISC is a specialist in the LNG business and one of the world's largest players in the sector. Its fleet of 13 carriers, of which 10 have a capacity of 130,000 cu m, ply between Sarawak and Japan. 

On its expression of interest to buy American Eagle Tankers Ltd (AET) from Singapore's Neptune Orient Lines Ltd, an analyst with a foreign brokerage said the acquisition, were it to happen, would be strategic for MISC because AET's routes were not covered by the Malaysian group. It would also expand MISC's capacity. 

“At the moment, we are not sure how much the deal would cost. It could be anything from US$400mil to US$700mil. As MISC's current gearing level is 30% to 40%, the expected increase in gearing would be still manageable for the shipping group,” he said. 

Among the notable acquisitions by MISC was US$1.8bil purchase of shipping assets from Konsortium Logistik Perkapalan Bhd and Petronas Tankers Sdn Bhd in April 1998. 

According to a consensus estimate, MISC is expected to record a net profit is RM1.2bil and sales of RM5.5bil for the year ending March 2003. For the six months to September 2002, MISC announced a lower net profit of RM572.4mil compared with RM775.8mil in the previous corresponding period. Revenue dipped slightly to RM2.7bil from RM2.8bil previously. 

The largest shareholder in MISC, with 62.44% stake, is Petroliam Nasional Bhd. 

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