By Ying Xian Wong
Swift Haulage shares rose after the company posted a more than doubling in quarterly earnings on an acquisition-related bargain-purchase gain.
Shares of the Malaysian integrated logistics provider rose as much as 13% on Thursday and were recently 4.6% higher at 0.57 ringgit, bringing year-to-date gains to 20%.
Swift Haulage said late Wednesday that its third-quarter net profit rose sharply to MYR28.4 million ($6.1 million) from MYR11.7 million a year earlier due mainly to a bargain-purchase gain related to the Global Vision Logistics stake acquisition.
The gains were partly offset by higher finance costs and employee-benefit and overhead expenses from business expansion, the company said.
Quarterly revenue rose 5.5% to MYR168.0 million.
MIDF Research said it expects Malaysia’s external trade to stabilize and regain momentum in the fourth quarter, which could benefit logistics players such as Swift Haulage due to its dominant position in the container haulage industry and its expanded fleet.
Swift Haulage’s new warehouses may also increase its occupancy rates and subsequently boost profit margins, MIDF analysts said in a note.
Some analysts expressed caution about the company’s outlook.
Apex Securities said in a research note that the company’s near-term outlook may remain challenging amid higher operating and finance costs following capacity expansions.
Still, the company’s long-term prospects appear optimistic, analyst Jayden Tan said, citing Swift Haulage’s growing market share and leading position in the domestic logistics industry.
Maybank Investment Bank said in a note that it is cautious about Swift Haulage’s outlook following five consecutive quarters of earnings misses. “Having said that, we believe its depressed share price has largely reflected the headwinds.”
Write to Ying Xian Wong at [email protected]
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