Below expectations. FY12/09 came in below expectations, and accounted for 63% and 61% of our and market full-year estimates respectively. The variance was largely due to:
1) lower-than-expected demand from China, Europe and Middle East; and
2) higher operating costs. 4Q net loss of RM31m (vs. 3Q net profit of 31.9m) was mainly due to slowing demand for process equipment from China and Middle East as well as still-weak demand for Borsig’s higher-end process equipment plus higher operating costs. Note that 4QFY12/09 average utilisation rates declined to 55% (vs. 65% in 3QFY12/09 and 85% in 4QFY12/08).
KNM Group Berhad : 4Q Dragged Down By Weak Demand From China & Middle East
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