Harrisons Holdings (Malaysia) Berhad

KUALA LUMPUR: Stocks to watch on Friday include MyEG Services Bhd, Lay Hong Bhd, Malayan Banking Bhd (Maybank), Harrisons Holdings (M) Bhd, Atlan Holdings Bhd and Velesto Energy Bhd.

General Meetings: Outcome of Meeting

Quarterly rpt on consolidated results for the financial period ended 31/03/2024

Annual Report & CG Report - 2023

HARISON - Notice of Book Closure

General Meetings: Notice of Meeting

Final Dividend

OTHERSHARRISONS HOLDINGS (MALAYSIA) BERHAD ("THE COMPANY")
- PROPOSED FINAL SINGLE-TIER DIVIDEND OF 50 SEN PER ORDINARY SHARE FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023

Quarterly rpt on consolidated results for the financial period ended 31/12/2023

Change of Address

$HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD): Lower Profits in Q3FY2023

1. Revenue: RM559.26 million reflects a 3.71% year-on-year upswing due to increased cement sales in the Building Materials Division. YTD, revenue stands at RM1.75 billion, marking a 5.64% increase, primarily propelled by escalated cement sales due to heightened demand and raised selling prices.

2. Gross Profit: Totals RM64.99 million, a 1.6% year-on-year decline, yet represents a 5.15% year-to-date increase, amounting to RM195.82 million.

3. PBT: Yields RM20.49 million, a 10.8% year-on-year dip attributed to slightly decreased gross margins, escalated selling and distribution costs, and increased interest expenses due to a higher OPR. YTD PBT records RM68.82 million, an 8.17% increase owing to higher sales from price hikes, reduced costs, and lower impairment allowances.

4. Segmental Performance: Trading and Distribution (T&D) segment contributes 97.7% of total revenue, followed by retailing (1.67%) and shipping and other segments (0.63%). The T&D segment sees a 5.63% year-on-year revenue increase due to boosted sales in key product categories but experiences a 15.21% decrease in Industrial and Agriculture Chemicals sales. Retailing sees a 17.57% rise in revenue attributed to increased Famous Amos cookie sales. The Shipping and other segment reports a 16.31% revenue decline due to reduced shipping activities.

5. Balance Sheet: Maintains a net cash position of RM17.45 million, with RM128.89 million in cash and RM111.44 million in borrowings.

6. Outlook: Foresees favorable performance aligned with Malaysia's 4%-5% GDP growth. A focus on leveraging their extensive network and skilled workforce, implementing an ERP system in Sabah for improved efficiency, and vigilantly monitoring operational costs.

Quarterly rpt on consolidated results for the financial period ended 30/09/2023

some east malaysia update

pan borneo sarawak is 98% completed. from the open info , at least half of the stretch have fully opened to the public (4 lane dual carriageway) . remaining stretches are at somewhere around 90-95% completion.

meanwhile in sabah , the progress is sluggish. May refer my post (journey to the east). For Sabah segment , Suria is having hiccup as the port in seppangar is too small to handle the volume . but the upgrading works are ongoing.

direct impact in logistic would be increase turnover , save time and save operating cost . (back then the road in east malaysia were horrendous)

there are few listed company in related business.
$HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD) $KTC / 0180 (KIM TECK CHEONG CONSOLIDATED BERHAD)

A Brief Analysis on $HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD)

1. Background
- The primary source of income is generated through the marketing, sales, warehousing, and distribution of various products, including consumer goods, building materials, engineering products, fine wines, agricultural and industrial chemicals. Additionally, the company is involved in the operation of shipping and logistics services, travel agencies, and retailing.
- These business operations are conducted in the following manner:
a) In East Malaysia, Harrisons Sabah Sdn. Bhd. and Harrisons Sarawak Sdn. Bhd. are engaged in marketing, sales, warehousing, and distribution activities, covering fast-moving consumer goods, building materials, engineering products, and agricultural chemicals. They also operate shipping and travel agencies in this region.
b) In Peninsular Malaysia, Harrisons Peninsular Sdn. Bhd. and Harrisons Marketing & Services Sdn. Bhd. handle marketing, sales, warehousing, and distribution tasks for building materials, industrial and agricultural chemicals. They are also involved in the import and distribution of fine wines and provide freight forwarding and shipping services. Harrisons currently represents over 400 principals and distributes approximately 13,000 product items to more than 15,000 accounts across Malaysia. The company maintains a comprehensive network of 27 branches and 47 strategically located warehouses throughout Malaysia, including 13 in Peninsular Malaysia, 9 in Sabah, and 5 in Sarawak. This extensive operation is supported by a workforce of over 1,700 employees.
c) In Singapore, Harrisons' subsidiaries, The Famous Amos Chocolate Chip Cookie Singapore Pte. Ltd., engage in both wholesale and retail activities for the Famous Amos Cookies, while Watts Harrisons Sdn. Bhd. specializes in the wholesale distribution of Komonoya brand products with standardized pricing.

2. Revenue Distribution
- 80% from FMCG
- 14% from Building Materials and Engineering Products
- 3% from Industrial and Agricultural Chemical Products
- 2% from Retailing
- 1% from Other Businesses

3. 2QFY23’s Results
- In the current quarter, revenue experienced a growth of RM11.5 million, marking a 2.05% increase compared to the same period last year. This rise can be attributed primarily to increased sales in our key Fast-Moving Consumer Products and cement within our Building Materials Division.
- Profit before tax for the current quarter saw a significant improvement, totalling RM3.7 million or a 16.30% increase compared to the previous corresponding quarter. This positive financial performance can be attributed to several factors:
a. Stronger sales, which increased by 2.05% in the current quarter.
b. Gross margins also saw a slight increase, rising from 11.04% in the previous corresponding quarter to 11.18%, mainly due to lower costs of sales in the current quarter.
c. Selling and distribution costs decreased by RM3.7 million in the current quarter compared to the previous corresponding quarter. This reduction was driven by the reversal of an allowance related to slow-moving inventories, amounting to RM4.6 million in the current quarter.
d. Additionally, interest income increased by RM124,000, a result of the 0.25% increase in the Overnight Policy Rate (OPR) during the current quarter.

4. Past 5 years Financial Performance
- Revenue witnessed a growth from RM1,651.43 million to RM2,174.12 million, with a compounded annual growth rate (CAGR) of 6%.
- The company's Profit After Tax (PAT) also experienced significant growth, rising from RM22.07 million to RM67.98 million, reflecting a CAGR of 25%.
- Notably, the company achieved a double-digit Return on Equity (ROE) of 16.19% in 2022, showcasing an increase from 7.06% in 2018.
- Furthermore, in 2023, the dividend yield reached a record high, reaching 5.9%.

5. Valuation
- We use year 2022 financial result to do estimation for the next 5 years share price of the company.
- We assume that:
a. Year: 2022
b. Price: RM8.50
c. Ave. EPS Growth (5-years): 27%
d. 2022 EPS: RM0.9747
e. Ave. P/E (5-years): 18.1
f. Ave. Dividend (5-years): 3%
g. Estimated Growth: 10%/year
- After we done the calculation, we estimate that the value of the company is RM9.07. The value seems undervalued but not attractive.

6. Conclusion
a. Strength
- Wide Distribution Network
- Moat: Low Profit Margin
- Doesn’t affected by PANDEMIC or INTEREST RATE HIKE
- Revenue and PAT grow every years
- Profit Margin Increase
- Consistent Dividend Paid out

b. Concern
- Whether the grow sustain or not
- High Share Price
- Even though the calculation shows the value of company is RM9.07 but only if the company can have a consistent 10% grow for 5 years. What if the company only have 5% grow instead of 10%?
- Therefore, it is better to buy at discount, after 25% discount on value, the share price is RM6.82
- But I personally prefer share price below BV, as at 2022, the BV of the company is RM6.13/share. As such I prefer buy below RM6.13 so that the stock price has more space to increase.


Further and more in-depth analysis will be conducted afterwards.

Quarterly rpt on consolidated results for the financial period ended 30/06/2023

General Meetings: Outcome of Meeting

Change in Risk Committee - DATUK LIM TONG LEE

Change in Risk Committee - MR WONG YOKE KONG

Change in Boardroom - MR WONG YOKE KONG

Quarterly rpt on consolidated results for the financial period ended 31/03/2023

@terence775 Thank you. Now I understand why the big swing in profit.

Its peer $LUXCHEM / 5143 (LUXCHEM CORPORATION BERHAD) also have similar pattern of margin compression. The share price has also come down.

Any idea whether such upcycle/ downcycle pattern apply to the consumer goods distributor $DKSH / 5908 (DKSH HOLDINGS (MALAYSIA) BERHAD) and $HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD) ? Their net margins have more than double as compared to 5 years ago. But so far the margins remain high. I wonder if the margin could sustain. (I recall you've studied Harrison, and maybe DKSH too?)

Annual Report & CG Report - 2022

HARISON - Notice of Book Closure

$HARISON / 5008 (HARRISONS HOLDINGS (MALAYSIA) BERHAD) proposes dividend of 50sen.

At share price of RM 9.16, that's approximately 5.5% dividend yield, at 50% payout ratio.

@boncos @doitduitcom

haven't studied deeper for now, but seems interesting.

Final Dividend

General Meetings: Notice of Meeting

Change of Address

Change in Risk Committee - DATUK LIM TONG LEE (Amended Announcement)

Change in Boardroom - MR CHONG CHEE FIRE

Change in Boardroom - DATUK LIM TONG LEE