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This digi
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MONDAY JUNE 22, 2015 ISSUE 1986/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
www.theedgemarkets.com
LRT3 shortlist down to three
names — sources. Story on Page 5
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FBM KLCI 1721.77
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KLCI FUTURES 1714.50
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STI 3300.96
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CPO RM2240.00
4.00
OIL US$63.02
1.24
GOLD US$1201.50
1.80
PP 9974/08/2013 (032820)
PENINSULAR MALAYSIA RM1.60 (INCLUSIVE OF 6% GST)
MONDAY JUNE 22, 2015 ISSUE 1986/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
Aspen, OCBC sign loan deal to kick
off Phase 1 of Aspen Vision City
12 PROPERT Y SNAPSHOT
6 HOME BUSINESS
IFCA remains
intact despite share
price slump
7 HOME BUSINESS
Forced outages
at six plants test
national grid
7 HOME BUSINESS
Lower ticket
sales cloud NFOs’
prospects
LRT3 SHORTLIST
DOWN TO THREE
NAMES — SOURCES
Naza TTDI-CSR Zhuzhou JV,
MRCB-George Kent JV and UEM are said
to have submitted the most attractive bids.
Jose Barrock has the story on Page 5.
20 H O M E
‘A good thing
that Pakatan did not
take over Putrajaya’
26 W O R L D
‘Pirates’ held by
Vietnam speak
Indonesian — media
World Bank: Malaysia needs
to be more transparent in
contingent liabilities
5 HOME BUSINESS
Frederico Gil Sander
4
M ON DAY JU N E 22 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
For breaking news updates go to
ON EDGE T V
EPF dumps
FGV shares
over steep Indo
deal
Masterskill
talks plans
after getting
green light to
sell assets
Malaysia to commemorate first
anniversary of MH17 tragedy
IPOH: Malaysia will commemorate
the first anniversary of the tragedy
involving the crash of flight MH17
which was shot down in eastern
Ukraine last July.
Transport Minister Datuk Seri
Liow Tiong Lai said the matter would
be presented in the Cabinet meeting
on Wednesday for further action.
Apart from Malaysia, he said
Netherlands and Australia would
also hold similar anniversaries in
their respective countries.
“Netherlands will hold the anniversary to commemorate the MH17
tragedy on July 17 while Australia
will also have it in the same month
(July),” he told reporters at the Yoga
Morning Exercise programme at Sekolah Jenis Kebangsaan Cina Bercham here yesterday.
He said Malaysia Airlines is ready
to bear the expenses for the families
of the tragedy’s victims wishing to
attend the anniversary celebration
in the Netherlands.
On the Interim Report prepared
by the security investigation team,
Liow said it should be released before the anniversary.
He said the investigation team
needed to analyse the incident as the
people wanted to know the truth, including who shot down flight MH17.
Flight MH17 was flying from Amsterdam to Kuala Lumpur when it
was shot down in eastern Ukraine
last July 17, killing all 298 passengers
and crew on board. — Bernama
EC tells Bersih
to lodge report
If they feel 1MDB backed Najib’s GE13 campaign
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KUALA LUMPUR: The Election
Commission (EC) questioned the
actions of election watchdog Bersih
2.0 which had accused it of failing to
introduce necessary reforms to rein
in unfettered electoral abuse and
corruption, following a Wall Street
Journal (WSJ) report that 1Malaysia Development Bhd (1MDB) had
indirectly bankrolled the prime
minister’s 2013 election campaign.
EC chairman Tan Sri Abdul Aziz
Mohd Yusof said Bersih 2.0 should
collate evidence and lodge reports
with the relevant authorities if it felt
the WSJ report had merit.
“Collect full and complete evidence and lodge a report with the
police or the Malaysian Anti-Corruption Commission if there is any
evidence of graft so that the authorities can investigate,” he told The
Malaysian Insider via Whatsapp
yesterday.
He said all the parties were given ample opportunities to make
their case following the results of
the 13th general election (GE13)
slightly more than two years ago
and questioned why Bersih 2.0 is
still raising the same issue.
“More than 60 petitions related
to GE13 were brought to court, and
Bersih definitely knows the outcome.
“Why are they still raising it near-
Abdul Aziz: Bersih 2.0 should
collect full and complete evidence
and lodge a report with the police
or the Malaysian Anti-Corruption
Commission.
ly three years after the general election?” he said.
PKR vice-president Nurul Izzah
Anwar said the EC should immediately investigate claims that 1MDB
indirectly bankrolled Prime Minister Datuk Seri Najib Razak’s 2013
election campaign.
She said it would also lend credence to EC’s independence should
it charge Najib under the Election
Offences Act 1954, specifically under Section 10(a), which covered
bribery before, during and after
elections with the intention to buy
votes.
In its report, WSJ said debt-ridden 1MDB had indirectly supported Najib’s campaign by purchasing
power assets from Genting Group
in 2012 for five times more than
its worth.
Genting allegedly donated part
of the earnings to a foundation controlled by Najib. WSJ said the foundation, Yayasan Rakyat 1 Malaysia,
then announced several charity
projects that Najib later brought
up during his campaign.
“Though set up to help underprivileged Malaysians through education and sport, this charity soon
got involved in spending that appeared designed to help Najib retain power in the May 2013 election,” said WSJ.
In a response to WSJ, the Prime
Minister’s Office said the claims
were baseless.
In an immediate response,
Bersih 2.0 condemned what it
termed the manipulation of funds
in GE13, and that it was even more
shocking to learn that the political financing was linked to 1MDB,
which was heavily scrutinised over
its RM42 billion debt. — The Malaysian Insider
China to promote cross-border e-commerce
BEIJING: China will increase support for cross-border e-commerce
as the world’s second-largest economy shifts from manufacturing to
higher-value services, the government said.
China’s e-commerce industry
has been booming in recent years,
with companies like Alibaba Group
Holding Ltd and JD.com Inc benefiting from a rising middle class
with more disposable income.
The government released policy guidelines on Saturday that include tax policies aimed at boosting domestic consumption and
pilot projects to ease overseas payments, according to a statement
posted on the central government’s
website www.gov.cn.
Chinese e-commerce firms will be
given state support on international
projects, while credit insurance services will also be introduced.
Customs will streamline clearance of goods and quality supervision agencies will allow collective
declaration, examination and release of goods.
There will be tax sweeteners on
e-commerce retail exports and settlements of payments in yuan will
be promoted, it added. — Reuters
The matter will be presented at the
Cabinet meeting on Wednesday for
further action, says Liow.
IN BRIEF
German police: Cat bites
woman, woman bites man
BERLIN: A cat bit a woman in
Germany, sending her into such
a rage that she then repeatedly
bit and beat her boyfriend, the
owner of the pet, police said yesterday. A police spokesman said
that the 26-year-old woman was
attacked by her partner’s feline
in the western city of Hagen in
the early hours of Saturday. After she tried in vain to discipline
the cat, “a fight between the bitten person and the cat’s owner
ensued in which the 39-yearold was hit and bitten several
times,” the spokesman said in
a statement. He was taken to
hospital for treatment while the
woman, who was charged with
domestic violence, was slapped
with a 10-day restraining order
barring her from the flat. — AFP
Cargo hold fire forces SIA
flight to land in KLIA
PUTRAJAYA: A Singapore Airlines (SIA) aircraft was forced
to make an emergency landing
at the Kuala Lumpur International Airport (KLIA) in Sepang
after encountering a fire in the
cargo hold yesterday evening.
Flight SQ425 from Mumbai to
Singapore, carrying 190 passengers touched down at KLIA at
about 3.55pm, after reporting
a “technical error”. Malaysian
Fire and Rescue Department
officers were despatched to
the scene to assist in taking
passengers off the plane before opening the cargo door.
— Bernama
Tsipras presents new proposals on EU summit eve
ATHENS: Greek Prime Minister Alexis Tsipras unveiled new
proposals on a “mutually beneficial deal” to end his country’s debt crisis in a telephone
call with European Union (EU)
leaders yesterday, his office
said. The proposals presented
by Tsipras to German chancellor Angela Merkel, French
President Francois Hollande
and European Commission
president Jean-Claude Juncker
on the eve of a crucial EU summit, were aimed at reaching
a “definitive solution” to the
stand-off between Athens and
its creditors, the Greek statement added. — AFP
HOME BUSINESS 5
M ON DAY J U N E 22, 20 15 • T HEED G E FINA NCIA L DA ILY
Three outfits said to be on
shortlist for LRT3 PDP
But Prasarana says evaluation is still ongoing and no front runners have been identified
BY JOSE B A RROCK
KUALA LUMPUR: Three outfits —
a joint venture between Naza TTDI
Sdn Bhd and China’s CSR Zhuzhou
Electric Locomotive Co Ltd (Naza
TTDI- CSR Zhuzhou JV), a partnership involving Malaysian Resources
Corp Bhd (MRCB) and George Kent
(M) Bhd (MRCB-George Kent JV),
and UEM Group Bhd — are understood to be the front runners for the
role of project development partner
(PDP) in the proposed RM9 billion
third light rail transit line (LRT3).
According to sources, the three
outfits have put in the most attractive proposals out of seven companies initially shortlisted by Prasarana
Malaysia Bhd.
The other four companies that had
expressed interest to play the role of
PDP were IJM Corp Bhd, a tie-up between Gamuda Bhd and MMC Corp
Bhd, Sunway Construction Sdn Bhd,
as well as a JV between WCT Bhd
and Alloy MTD. Alloy MTD Group
of Malaysia is the merged entity of
MTD Capital Bhd and its parent Alloy Consolidated Sdn Bhd.
“It seemed that the three — Naza
TTDI- CSR Zhuzhou JV, the MRCBGeorge Kent JV and UEM — had
submitted the most attractive bids.
So, it could be one of the three,” a
source told The Edge Financial Daily.
When contacted by The Edge Financial Daily, a Prasarana official,
however, said the evaluation is still
ongoing and that no front runners
have been identified yet.
An artist’s impression of an LRT3 station. Construction of the LRT3 is set to commence late this year, as per the schedule of the Land
Transport Commission.
“It’s not true,” the official with the
rail and bus operator said of talk that
only three outfits are in the running
now.
Nevertheless, several rail executives spoken to, and some of the
bidders even, said the list of seven
had been narrowed down to three,
with all suggesting the same three
names, which are the Naza TTDICSR Zhuzhou JV, the MRCB-George
Kent JV and UEM.
The appointment of the PDP is
likely to be done soon, with the construction of the LRT3 to commence
late this year, as per the schedule of
the Land Transport Commission.
Sources said the Naza TTDI- CSR
Zhuzhou JV’s strength lies in its proposal, which offers up to 90% financing for the project. Naza TTDI is understood to have a 75% stake in the JV.
A check on Naza TTDI’s website
showed that the group had recently
added Naza Engineering and Construction Sdn Bhd to its stable of
companies, which would enable it
to undertake civil engineering and
infrastructure works.
There has been talk of Naza TTDI
looking at floating the company on
Bursa Malaysia, but this could have
taken a back seat due to the weak
market conditions.
For its financial year ended December 2013 (FY13), Naza TTDI posted a net profit of RM94.2 million on
revenue of RM1.4 billion.
A search at the Companies Commission of Malaysia (SSM) revealed
that Naza TTDI, as at end-December
2013, had current assets in excess of
RM1.3 billion and non-current assets
of over RM1 billion.
Its long-term debt commitments
stood at RM936.8 million and shortterm borrowings amounted to
RM692.2 million.
The group also had reserves of
RM485.2 million.
UEM, meanwhile, via its wholly-owned subsidiary UEM Builders Bhd, is capable of handling such
rail jobs as the LRT3, as it has been
involved in many large-scale infrastructure jobs, including the Second
Penang Bridge.
For its FY13 ended December
2013, UEM Builders posted a net
profit of RM38.4 million on revenue
of RM2.4 billion.
It was previously rumoured that
UEM was looking to hive off UEM
Builders, and there were several parties that had expressed interest, but it is not clear what has
happened since then. UEM is a
wholly-owned unit of state-controlled investment arm Khazanah
Nasional Bhd.
MRCB (valuation 1.4, fundamental 1.3) is a construction and
development company which is
35.9% controlled by the Employees Provident Fund. Other notable substantial shareholders are
Tan Sri Mohamad Salim Fateh Din,
who has a 16.7% equity interest in
MRCB.
MRCB has been awarded several rail jobs in the past, including
the upgrade of the Klang Valley
double-tracking system valued at
around RM850 million, and has
won contracts for the fabrication
and delivery of segmental box girders for both the Kelana Jaya LRT
and Ampang line extension.
It is also worth noting that MRCB
owns the KL Sentral commercial
development, which is linked to
the KTM, LRT and Express Rail
Link systems.
George Kent (valuation 1.8, fundamental 1.4), meanwhile, is 42.2%
controlled by Tan Sri Tan Kay Hock,
who is said to be a close associate
of Prime Minister Datuk Seri Najib
Razak.
In 2012, Prasarana had awarded
George Kent the contract for the engineering, procurement, construction,
testing and commissioning of system
works for the Ampang line extension
project, partnering privately-held
Lion Pacific Sdn Bhd. However, there
have been delays to this job.
Meanwhile, market observers are
surprised at the exclusion of Gamuda
(valuation 1.1, fundamental 2.2) and
MMC (valuation 1.4, fundamental
0.4) from the final list of candidates,
although some said that’s probably
due to the many jobs already awarded to the two companies.
Other than being the PDP for the
Klang Valley Mass Rapid Transit Line
1 and 2, Gamuda is also among the
front runners for the RM27 billion
Penang Transport Master Plan, which
is expected to be awarded soon.
The Edge Research’s fundamental score
reflects a company’s profitability and
balance sheet strength, calculated
based on historical numbers. The valuation score determines if a stock is
attractively valued or not, also based
on historical numbers. A score of 3
suggests strong fundamentals and
attractive valuations. Go to www.
theedgemarkets.com for more details
on a company’s financial dashboard.
More transparency needed in contingent liabilities
BY L EVI N A L I M
KUALA LUMPUR: Concerns over
the government’s mounting contingent liabilities and off-balancesheet obligations, including those
amassed by debt-laden 1Malaysia
Development Bhd (1MDB), are an
increasing drag on investor confidence.
While World Bank senior country economist for Malaysia Frederico Gil Sander acknowledged that
some of these extra obligations are
“quite productive” investments, he
also stressed the pertinent need for
the government to be transparent
on matters like 1MDB and contingent liabilities.
“The fact that the government
has assumed these guarantees is
not necessarily bad,” Sander told
The Edge Financial Daily in an interview.
“On the other hand, [the] people
are concerned about 1MDB. If the
government could produce a fiscal
risk statement on these kinds of
contingent liabilities, that would
give the public a comforted view
that they (the government) have
done some assessments,” he said.
“We think that a transparent
analysis of the fiscal risks involved
will be very important going forward,” Sander pointed out, adding
that the additional discipline of
habitual disclosure will enhance
the scrutiny of the financial guarantees granted by the government.
Two weeks ago, Prime Minister
Datuk Seri Najib Razak told Parliament that the government has
off-balance-sheet obligations of between RM4.8 billion and RM11.62
billion a year for nine government-owned companies starting
this year until 2020.
The figures have puzzled many,
including economists, as there is a
lack of detail on what the spending entails.
Sander pointed out that while
it is difficult to pre-empt the likelihood of a Fitch Ratings downgrade
of Malaysia’s credit rating, he expects the implementation of the
goods and services tax (GST) and
fuel subsidy rationalisation will
help to strengthen the country’s
credit standing.
But he highlighted that there is
much more the government needs
to do to maintain its long-term fiscal sustainability.
“To achieve the target of reducing the fiscal deficit to 0.6% by 2020,
we are looking at the government
imposing hard medium-term ceilings on ministries on how much
new spending they are going to
have moving forward.
“That communicates a lot more
credibility as to how you are going to be achieving lower deficit
numbers, which are to me what is
important — to remain in a continuously declining fiscal deficit,”
said Sander.
The World Bank economist also
acknowledged the tension that the
central bank had been juggling
among various priorities — high
household debt, slowdown in consumer spending and cooling down
property prices. “These would give
reason for Bank Negara Malaysia
not to aggressively raise interest
rates,” he opined.
But, on the other hand, there are
also reasons for the central bank to
consider cutting interest rates due
to the concerns over the weakening ringgit and the current account
balances.
“They’re basically pulled in two
directions, which is why in recent
times, we’ve seen that [the] interest
rates have not moved,” Sander said.
He said the recovery of oil prices
had also been a boon to the Malaysian economy, with the government
likely to beat its fiscal deficit target
of 3.2% of gross domestic product
(GDP) to 3.1% of GDP because the
current oil prices are higher than
the US$55 per barrel budgeted in
the revised Budget 2015. In addition, there were extra savings from
the removal of fuel subsidies.
Commenting on the weak export data in April, which fell 8.8%
year-on-year, Sander said the second-quarter data on real exports
would be crucial to determine how
much impact the weaker ringgit has
had on boosting exports.
“On the E&E (electrical and electronics) side, it is fair to say that
Malaysia has been losing competitiveness for many years. However,
2014 was the first year that you had
lower imports than exports of E&E.
“We are starting to see some
encouraging signs of a strong expansion of the value added despite
lower exports, which suggests to
me that the value-added quantum
of the exports has also expanded,”
he said.
Sander projected that Malaysia’s current account balance will
narrow to 2.5% of GDP this year
due to declining natural gas prices, greater investment abroad and
higher imports by the private sector
to rebuild their inventories.
“The weaker exchange rate
made some of the equipment
investments a bit more expensive, but a narrower surplus is
not a major concern as long as it
is driven by imports for productive investments, such as the Mass
Rapid Transit,” he said.
6 HOME BUSINESS
IFCA remains
intact despite
share price slump
IFCA MSC Bhd
IFCA MSC Bhd
Net profit for the financial quarters
RM
2.0
10000 (RM‘000)
1.5
8000
6000
1.0
4000
RM1.25
2000
0
0.5
1Q
2Q
3Q
FY14
4Q
1Q
FY15
0.0
June 19, 2014
June 19, 2015
Road map for e-commerce is one of the drivers designed to sustain its earnings growth
BY SU PRI YA SU RENDRAN
KUALA LUMPUR: IFCA MSC Bhd
executive chairman Ken Yong Keang
Cheun admits that he has been having
sleepless nights over the past three
weeks no thanks to the rumours
around the resignation of the company’s chief financial officer (CFO).
Worse, the rumours, which Yong
has refuted during an interview with
The Edge Financial Daily last Friday, had caused IFCA’s share price
to slump to 90.5 sen from a peak of
RM1.84 last Monday. The stock regained some lost ground to close at
RM1.25 last Friday.
“It has been a sleepless past three
weeks for me when the slump happened, but I believe the worst is over,”
said Yong, who is also the chief executive officer of the IT solutions provider
that specialises in the property sector.
Also, he reiterated that operations-wise, IFCA (fundamental:3.0;
valuation:0.8) is doing well and has
mapped out plans for regional ex-
pansion. IFCA, the best performing
IT stock in the Asia-Pacific last year,
had investors in a buzz when it announced the resignation of CFO Voo
Lip Sang on May 22 — two days after
the release of a stellar set of financial
results that showed an astronomical jump of 2,200% in net profit to
RM9.69 million for its first quarter
ended March of financial year 2015
(1QFY15) from RM421,000 in the
previous corresponding quarter. Revenue had also increased by 134% to
RM31.98 million in 1QFY15 from
RM13.69 million in 1QFY14.
“There were rumours that our
CFO had resigned because we
cooked the books and therefore
were able to report an exemplary
net profit. If we did indeed cook
the books, there is no way our CFO
would have signed off the accounts.
This is all just speculation as he
had actually resigned to start his
own business venture,” said Yong.
Yong attributed the sharp fall in
IFCA’s share price to selling from for-
eign funds amid the weak sentiment
in the broad market.
“My understanding is there was
some foreign funds selldown, and
then some retailers were left puzzled
by the rumour mill going on which
could have caused the share price
to drop further. However, I would
like to point out that foreign funds
are still very much invested in our
company,” said Yong.
As at June 12, IFCA’s foreign shareholding was at 16.38%, while local institutional investors held 20.72% and
retail investors 23.89% of its shares.
Yong said that IFCA is “transforming”, from a traditional project-based
organisation to one that derives income on a recurring basis.
However, he acknowledges that
the exponential earnings growth
will normalise once the low base
effect tapers off. “Nevertheless. we
still expect earnings to be higher
than the previous year [albeit a
moderate growth],” said Yong.
“New products will be introduced
and sold as software as a service
(SaaS), whereby products are sold on
a subscription basis, instead of a onetime lump sum payment,” he said.
Indonesia is a market in which
IFCA plans to milk its SaaS products, and the group had on May 20
entered into a heads of agreement
with PT IFCA Consulting Indonesia
(Pici) to acquire the latter’s business, including goodwill and receivables, for RM32 million. Half of the
purchase consideration would be
settled by cash while the remaining will be satisfied through issue
of new IFCA shares.
“We are excited about Indonesia,” said Yong, noting that the migration of Pici’s customers from
using Windows-based software to
web-based solutions would happen
sooner or later.
He noted that there would be a
profit guarantee given by Pici to ensure IFCA’s interest is protected.
On its China front, Yong said
the property market slowdown in
the world’s second largest economy will not dampen the group’s
operations there.
“We have more than a hundred
customers in China of which most
are big property players. Our strategy is to focus on the big players as
they value international experience
that we offer. We are in the midst
of closing some big deals in China
now,” he said.
Another area the group is looking
at is its e-commerce initiative. It plans
to create an e-commerce platform
for the property industry.
“We have an intimate knowledge
of key property industry issues and
challenges, and we see e-commerce
as a way forward, to bring immense
industry-wide productivity and competitiveness,” said Yong.
He added that IFCA’s road map
for e-commerce, and its affordable
solutions approach through SaaS plus
its proposed Indonesian venture, will
be the drivers that the group needs to
sustain its earnings growth.
Analysts see Tan Chong stuck in low profit gear
BY JEFFREY TA N
KUALA LUMPUR: The prognosis isn’t
looking good for Tan Chong Motor
Holdings Bhd, the exclusive distributor of Nissan vehicles in Malaysia,
with analysts predicting new car sales
will continue to sputter during the remainder of the year and drag down
the group’s profit.
Tan Chong’s weak first quarter
earnings were a testament to the challenging operating environment, and
perhaps even a leading indicator of
weak financial performance in the
coming quarters.
Responding to queries from The
Edge Financial Daily, Tan Chong
acknowledged that 2015 will be a
challenging year for all car players in
the sector, no thanks to the depreciating ringgit and subdued consumer
sentiments after the implementation
of the goods and services tax (GST)
on April 1, as well as economic uncertainties.
Nevertheless, the group says it
will brace itself for the headwinds
by focusing on cost and expense optimisation that includes marketing
expenses.
“Expenditures will be prioritised
to take on these challenges faced by
the group. The group will take diligent
steps to monitor the foreign currency
risk and maintain the business competitiveness throughout the year to
ensure its sustainability,” it says.
At the same time, Tan Chong says
it will continue to ride on its successful models launched early this year,
namely the Nissan Almera facelift,
“the very successful” X-Trail series.
and other key models such as the
Teana, Serena Hybrid and Navara.
It adds that year-to-date sales were
8.2% higher than a year earlier, marking a positive reception of its products in a highly competitive market.
However, analysts are mostly lukewarm on the group, as they see an
unexciting near-term earnings outlook with no clear catalyst to drive
its share price higher. They also see
the GST implementation hampering
demand for new vehicles in the next
six to nine months before consumer
spending normalises.
Tan Chong (fundamental: 0.55;
valuation: 1.4) saw its share price dip
to a five-year low of RM2.72 last Friday, bringing a market capitalisation
of RM1.78 billion. This compared with
its peak of RM6.98 on Aug 30, 2013.
The stock has lost 17% or RM366 million of its value since Jan 2 this year
when it closed at RM3.28.
Still, an analyst who declined to
be named says it will depend on how
Tan Chong performs in the next two
to three quarters before investors get
into reasons to sell their shares in the
group to cut losses.
“Things don’t look good. There
are no clear catalysts (to push the
group’s share price higher),” he said.
Tan Chong Motor Holdings Bhd
RM
6
Vol (mil)
2.5
2
5
1.5
4
1
3
0.5
RM2.72
2
0
June 19, 2014
June 19, 2015
“But with its share price having gone
down so much, we think the negatives have been priced in already,”
the analyst added.
“We think that existing shareholders should hold on to the stock. But
for investors who want to get in, we
think they should wait for better timing,” HLIB Research analyst Daniel
Wong told The Edge Financial Daily.
Wong foresees that Tan Chong’s
earnings may disappoint in the subsequent quarters due to the implementation of the GST and higher import costs as a result of the stronger
greenback.
The ringgit has dropped against
the US dollar to close at 3.739 last Friday from the 3.20 level in the middle
of last year.
Another analyst says it remains to
be seen whether Tan Chong can beat
consensus forecasts, which many
analysts have lowered following the
group’s disappointing first quarter
net profit.
The analyst is of the view that Tan
Chong’s car sales volume was “not
great” despite a higher figure, adding
that the group is facing stiff competition from other car brands.
RHB Research Institute in a May
report had slashed its 2015, 2016
and 2017 net profit estimates for Tan
Chong by 25.8%, 14.3% and 9.4% respectively. It cites risks for the group
that include unfavourable foreign
exchange (forex) movements, slower-than-expected economic growth,
weaker consumer sentiment, higher interest rates and a tightening of
financing. JF Apex Securities also
trimmed its net earnings forecast
for 2015 and 2016 by 8.5% and 12%
to RM130.02 million and RM160.04
million respectively.
The research house lowered its
car sales forecasts for Tan Chong to
47,206 units in 2015 from 51,132 units
previously and 49,567 units in 2016
from 55,734 units previously.
RHB Research Institute is maintaining a “neutral” rating on Tan
Chong with a lower target price (TP)
of RM2.80 from RM3.05 previously,
while JF Apex kept a “hold” rating with
a lower TP of RM2.99 from RM3.27
previously.
Last month, Tan Chong an-
nounced that its net profit had contracted 36.5% to RM26.35 million
in the first quarter ended March of
financial year 2015 (1QFY15), from
RM41.47 million a year ago.
This came on poorer contribution
from its car division, which recorded
lower earnings before interest, taxes,
depreciation and amortisation of
RM73.3 million due to higher costs
of completely knocked down kits.
Tan Chong blames the higher
cost on an unfavourable forex rate
compared with the same quarter last
year, despite revenue rising 24.5%
to RM1.57 billion in 1QFY15 from
RM1.26 billion a year earlier.
Meanwhile, Tan Chong remains
unfazed about the deep discount in
its valuation. “We believe with our
solid track record, our shareholders
and other stakeholders will have confidence in the management in facing
the challenges and weathering the
storm,” it says.
The Edge Research’s fundamental score
reflects a company’s profitability and
balance sheet strength, calculated
based on historical numbers. The valuation score determines if a stock is
attractively valued or not, also based
on historical numbers. A score of 3
suggests strong fundamentals and
attractive valuations. Go to www.
theedgemarkets.com for more details
on a company’s financial dashboard.
HOME BUSINESS 7
Lower ticket
sales cloud NFOs’
prospects
BY CHEN SHAUA FU I
KUALA LUMPUR: Lady Luck is on
the side of the two public-listed
number forecast operators (NFOs)
— Berjaya Sports Toto Bhd (BToto)
and Magnum Bhd, both of which
achieved double-digit net profit growth in the latest quarterly
earnings.
However, investment analysts
warned that investors should not
get overly excited about the higher-than-usual profit growth, noting
that there has been a consistent
decline in ticket sales per draw
for the past few quarters.
BToto’s (fundamental: 1.3;
valuation: 2.1) net profit jumped
11.8% to RM77.51 million for the
fourth quarter ended April 30, 2015
(4QFY15). Its annual net profit
grew 9.6% to RM360.15 million.
For Magnum (fundamental:
1.7; valuation: 2), its net profit rose
10% to RM90.76 million for the
first quarter ended March 31, 2015
(1QFY15).
It seems exciting, judging by the
latest profit numbers. However, at
a closer look, the revenue from
the gaming segment is shrinking.
BToto, which offers the most lotto games among the three NFOs in
Peninsular Malaysia, saw its gaming revenue fall 4.1% year-on-year
(y-o-y) due to lower ticket sales plus
a fewer number of draws, compared
with the previous year. Meanwhile,
Magnum’s gaming revenue fell
0.15% y-o-y due to one less draw,
which was mitigated by higher sales
from the jackpot game and contributions from the new game.
CIMB analyst Marcus Chan
told The Edge Financial Daily that
ticket sales per draw of the NFOs
have been contracting for the past
six to seven quarters.
“I think it (the trend) will continue for the next one year, as the
operators face competition from
illegal operators due to the lack of
enforcement,” Chan said.
Chan noted that the implementation of the goods and services tax
(GST) also posed challenges to the
NFOs — as they had indicated that
they would absorb the 6% GST —
which he believes would impact
about 10% of their bottom line.
He said Magnum is more appealing than BToto in terms of dividend payments. According to him,
Magnum has committed a dividend payout of five sen per share
for every quarter, which translates
into a dividend yield of about 7.4%,
based on last Friday’s closing of
RM2.70. Meanwhile, BToto paid
out 21.5 sen for FY15, which translated into a lower-than-expected
dividend yield of 6.5% over a share
price of RM3.25, he added.
AllianceDBS’ Cheah King Yoong
pointed out that it could be overly
simplistic to examine the NFOs’
financial results based purely on
the quarterly performance because
some quarters could be good due
to seasonality, luck factors or the
accumulation of jackpot/lotto priz-
es that attracted stronger buying
interests.
“If we review the NFOs’ gaming
revenues on an annual basis, the
operating environment remained
challenging over the past few years
as ticket sales were on a declining trend, while the higher profits could be supported by lower
prize payouts and contributions
from other operations,” he told The
Edge Financial Daily in a phone
interview.
In the case of BToto, Cheah said
its quarterly profit increased y-o-y
partly due to a lower prize payout
ratio (better luck factor) and contributions from HR Owen, while its
core gaming operations remained
competitive.
“As such, investors should not be
too excited about its strong y-o-y
earnings growth for 4QFY15,” he
said.
“Although we have imputed the
GST impact to our earnings model,
we remain cautious that the group’s
near-term earnings prospects could
be dragged by lower ticket sales due
to the weaker consumer sentiment
post-implementation of the GST,
which is difficult to gauge at this
juncture,” Cheah added.
An analyst at a local investment
bank told The Edge Financial Daily
that despite the drop in ticket sales
per draw of both companies for
the past three years, the pace of
2% to 3% is not alarming.
“Basically, I expect an approximately 3% growth of ticket sales at
gross level [inclusive of the GST]
for both companies this year,” said
the analyst, who wished to remain
anonymous.
He said BToto had better luck
for FY15, as its payout rate was
around 60%, and it had a relatively lower risk than Magnum due to
more games to diversify its risk.
For Magnum, he said, the payout rate was theoretically 66% to
67%, but it was 65% from 69% for
the last two years, so his assumption was 65%.
He also said he focuses on the
valuations of companies that have
come down sharply, which lead to
attractive yields.
Over the past one year, BToto’s share price went down 9.82%,
while Magnum went down 4.96%.
The analyst said BToto’s share
price dropped more than the 6%
of the GST, “so the share price is
likely bottoming out”, and he believes now is the time to accumulate the shares.
The Edge Research’s fundamental
score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers.
The valuation score determines if a
stock is attractively valued or not,
also based on historical numbers.
A score of 3 suggests strong fundamentals and attractive valuations.
Go to www.theedgemarkets.com for
more details on a company’s financial dashboard.
Forced outages
at six plants test
national grid
TNB had to draw some 300mw of electricity from Thailand
BY BE N S HANE LI M
KUALA LUMPUR: Unplanned outages at three power plants triggered
Tenaga Nasional Bhd’s (TNB) issuance of an “orange warning” — an
emergency call for all electricity generators to be on full alert — earlier
this month.
In addition, it is understood that
three other power plants suffered
forced outages after the orange warning, which exacerbated the situation.
At the peak of the incident, the
national utility drew some 300mw of
electricity from the Electricity Generating Authority of Thailand for about
three hours to fill the supply gap.
While TNB denied that the outages resulted in load-shedding, the
incident tested the grid’s reserve margin and its ability to cope with such
emergencies.
“Due to the sudden additional
shortfall of 2,060mw of generating
plants caused by the forced outages
at Janamanjung U4 (1,010mw), Jimah
Unit 1 (700mw) and Tuanku Jaafar
Power Station GT 2A (350mw), there
is a possibility of insufficient generation to meet electricity demand
during this period,” wrote TNB’s Grid
System Operator in the orange warning letter to all generators on June 3.
“Should this happen, a possible
control action is to shed demand to
ensure [that the] integrity of the grid
is maintained,” the letter said.
Load-shedding is a controlled cut
of electricity to certain portions of the
grid, typically rural and low-priority
areas, to reduce demand. In turn, this
protects the grid as a whole from a
blackout.
“This is the contingency protocol
that is in place for such an incident to
prevent any loss of load. This event
shows that the national grid is robust
enough to cope with a huge and sudden loss of load without [causing]
major incidents,” a TNB spokesman
explained.
“TNB has never violated the loss
of load expectation threshold for one
day, of which the grid was planned
and designed for. We still have a reserve margin of 29%.”
Furthermore, the spokesman
pointed out that drawing power from
Thailand is part of a mutual agreement between the two countries to
support each other in the event of
a shortfall.
Generally, it appears that almost
every generator in the country played
a role in the orange warning incident.
Janamanjung 4 is a relatively new
plant owned by TNB, and arguably
still undergoing teething issues. The
Jimah Power Station is controlled by
Edra Global Energy Bhd, while the
Tuanku Jaafar Power Station in Port
Dickson is controlled by TNB.
The other three plants that suffered forced outages included a
450mw block of Segari Energy Ventures, controlled by Malakoff Corp
Bhd, which failed on June 4.
TNB and Malakoff ’s 60:40-controlled Kapar Energy Ventures saw a
forced shutdown of 560mw on June
5. TNB’s 100mw hydroelectric power
plant — Sultan Yussuf Power Station
(Jor) — also suffered a forced outage
during this period.
Furthermore, one 700mw unit of
Malakoff ’s coal-fired Tanjung Bin
Power Plant was also shut down for
planned maintenance at the time.
It is understood that Janamanjung
4, Jimah Unit 1 and the Tuanku Jaafar Power Station tripped around the
same time — during peak demand
in the middle of the day — causing
the orange alert to be issued.
It is extremely rare for so many
plants to “trip” at once. Call it Murphy’s Law, perhaps, but it has already
happened twice since May last year.
Unplanned outages at several
large power plants forced TNB to
load-shed, resulting in small, localised blackouts in five different states
in May last year. This raises the question whether the country’s power
supply would slip into a vulnerable
situation if electricity demand continues to grow?
As a stopgap measure, the Energy Commission is in the midst of
extending several power purchase
agreements to ensure that the country has enough power, after several
power plant projects were delayed.
One of the delayed projects is the
2,000mw coal-fired power plant project known as Project 3B, which 1Malaysia Development Bhd has won,
due to financing issues. The Cabinet
last week approved the takeover of
the project by TNB.
Another project expected to be
delayed is Project 4A — a 1,100mw to
1,400mw combined cycle gas turbine
plant — which is being undertaken
by SIPP Energy Sdn Bhd.
Six win over RM2.3m in Tropicana campaign
Ung: The campaign was part of the
group’s latest initiative to further engage
with our customers and the community
via digital and online platforms.
BY S AM ANTHA HO
KUALA LUMPUR: Six lucky winners
gained more than RM2.3 million
when they won the chance to purchase Tropicana Corp Bhd’s prime
properties at half the listed selling
prices through the Tropicana Dream
Investment Campaign.
They were Lim Kean, Helen Lee,
Narentharen Selvarajah, Vun Siew
Fui, Kelvin John Nathan and Chiam Ah Moy.
The one-of-a-kind investment
campaign ran from March 6 to April
16, a period of six weeks which saw
one winner selected each week.
In a statement last Friday, Tropicana said the winners had the
chance to “double” their investments in Tropicana’s prime properties, such as Tropicana Avenue,
Petaling Jaya, listed at RM959,900,
Tropicana Heights, Kajang, listed at
RM835,800 and Tropicana Cheras,
listed at RM747,520.
Hosted on the Tropicana Facebook page, the contest required
participants to select their favourite
Tropicana property and share their
Tropicana Dream Investment Campaign posts.
Throughout the contest period,
Tropicana also gave away other prizes, such as iPad mini, iPad Air, iMac,
MacBook and Samsung Galaxy Note,
to its weekly quiz winners and for
the highest social media shares on
Facebook.
“The campaign was part of the
group’s latest initiative to further
engage with our customers and the
community via digital and online
platforms,” Tropicana head of marketing and sales Ung Lay Ting said
in the statement.
“It took us weeks to tabulate the
results and gave us the wonderful
opportunity to understand our customers’ needs and why they choose
to invest in Tropicana’s properties,”
she added.
10
From left: The Edge Media Group publisher and group chief executive officer (CEO) Ho Kay Tat, Tan, Teoh, The Edge Education Foundation CEO Dorothy Teoh, The Edge senior managing editor Azam Aris and The Edge
Communications Sdn Bhd managing director Au Foong Yee. Photo by Abdul Ghani Ismail
OCBC, Jaeger-LeCoultre
step in as sponsors
Purpose of business is increasingly recognised as platform for providing meaningful service to humanity
BY MEENA L A KSHANA
O
CBC Bank (M) Bhd and Swiss
luxury watchmaker Jaeger-LeCoultre have stepped in as
sponsors for The Edge Billion
Ringgit Club (BRC) 2015.
In its sixth installation, the
BRC aims to recognise Malaysia’s largest
corporates for jobs well done — not only
in raking in profits but also in corporate
responsibility (CR) efforts.
OCBC has been the main sponsor since
BRC’s inception in 2010. Senior vice-president and corporate and commercial banking
head Jeffrey Teoh says awards like the BRC
act as an incentive for companies to adopt
a holistic approach to doing business.
He says that the purpose of business is
increasingly recognised as a platform for
providing meaningful service to humanity,
with profits being the means by which to
keep such a meaningful entity viable.
“I think a company exists as part of a
whole ecosystem in terms of regulators,
shareholders and stakeholders,” he says.
“So, if you don’t have an event to recognise
that, it is all for naught, it is not sustainable.”
He says OCBC enjoys being a part of
the annual event, not so much as an aid to
brand building, but because “it is the right
thing to do”.
“I think the not-so-obvious elements [in
business] such as how you operate in an
environment where there is growing awareness of CR, how we function in an economic
manner without destroying the environment
and how we operate in a manner where we
give opportunities for Malaysians to broad-
en their talent ... these things do not get
much coverage, but that’s why I think the
BRC is very different compared with other
awards,” he says.
“It is more holistic. It is a more balanced
scorecard.”
Jaeger-LeCoultre Malaysia country manager Reena Tan says BRC’s high standard
of assessment, which is based on quantitative and qualitative criteria, sets the
event apart from the others in the business community.
“I think it is important to give
recognition to corporations that
have done tremendously well
all round, not just in terms of
profits but also their contributions to the Malaysian
society,” she says.
“As Jaeger-LeCoultre,
too, plays a big role in
CR, it has had a strong
partnership with Unesco (United Nations Educational, Scientific and
Cultural Organization)
since 2008, to protect the
47 marine areas listed as
World Heritage sites.”
She says that the company has even made a short
video titled The Guardians on
Glacier Bay National Park. The
US national park is a hotbed for
marine biodiversity, recognising the work of scientists and
project managers in preserving the site.
The chief executive officer
(CEO) of the BRC Company of the Year
award winner will receive a Master Eight
Days Perpetual 40 watch. The watch has a
perpetual calendar and boasts an eight-day
power reserve, thanks to its twin barrels that
store up a considerable amount of energy.
Technically programmed to require no
manual correction before the year 2100 —
even the noblest mechanisms cannot keep
track of the century years that are not leap
years — it will continue to provide an accurate display of the date, the day of the
week, the month and the year in
four digits, along with the power reserve, the moon phase, the
alternation between night and
day, and even the security zone
between 10pm and 3am during which no changes must
be made.
Tan says the watch is
a symbol of the values
inherent in exemplary
leadership and for steering a company to the billion-ringgit mark.
“Jaeger-LeCoultre is a visionary brand that celebrates
accomplishment in fine watchmaking, combining elegance and
confidence,” she adds.
“Hence, our values are, in a
way, a fine representation of the
With its pink gold case measuring
40mm in diameter and strapped with
alligator leather, the Master Eight
Days Perpetual 40 embodies a unique
relationship with time.
corporation/CEO who will be receiving the
Jaeger-LeCoultre timepiece.”
The BRC recognises companies with a
market capitalisation of RM1 billion and
above as at March 31 each year.
The shortlisted companies, which are
added to the annual list automatically once
they fulfil the requirements, are evaluated
based on growth in profit before tax, returns to shareholders and CR commitments,
among others.
The CR initiative component is evaluated by a panel of judges, which includes an
OCBC representative.
The BRC awards include Malaysia’s Outstanding CEO, Most Profitable Company,
Highest Profit Growth Company and Best
Performing Stock.
Previous winners of the Malaysia’s Outstanding CEO award were Public Bank
Group chairman Tan Sri Teh Hong Piow,
CIMB group chairman Datuk Seri Nazir
Razak, AMMB Holdings Bhd chairman
Tan Sri Azman Hashim, AirAsia group
CEO Tan Sri Tony Fernandes, former Malayan Banking Bhd president and CEO
Datuk Seri Abdul Wahid Omar and former
S P Setia Bhd president and CEO Tan Sri
Liew Kee Sin.
Last year, Dutch Lady Milk Industries Bhd
clinched the Company of the Year award
while Sunway Group founder and executive
chairman Tan Sri Jeffrey Cheah and Axiata
Group president and CEO Datuk Seri Jamaludin Ibrahim bagged the Outstanding
CEO award.
Last year’s event was attended by Deputy
Prime Minister Tan Sri Muhyiddin Yassin.
H O M E B U S I N E S S 11
The long road to success
EY World Entrepreneur of the Year Mohed Altrad’s story is classic rags to riches
BY JANICE MELISSA THEAN
I
f anyone has had his fair share of trials and tribulations in life, it is Mohed
Altrad, who was named Ernst & Young
(EY) World Entrepreneur of the Year
(WEOY) for 2015.
Mohed, the founder and chief executive officer of Montpellier-based Altrad
Group, is the country winner for France and
was picked from among the 65 country winners from 53 countries vying for the title.
While he is a French citizen, Mohed is a
native Syrian, and was born to a Bedouin
tribe 65 years ago.
He was raised in poverty by his grandmother after his mother died at the age of
13, soon after his birth. Mohed reveals that
both he and his elder brother, who died
young, were the result of rape.
But you would never guess at Mohed’s
troubled beginnings, looking at his present success.
In 2014, Altrad Group — a leading construction equipment and scaffolding manufacturer in Europe — had a turnover touching €900 million.
Its profit before tax amounted to some
€200 million, according to Mohed, and this
might grow to €250 million (RM1.06 billion)
in 2016.
Altrad Group was born out of the rubble of a bankrupt scaffolding company that
Mohed bought with a partner 30 years ago.
It cost him some €700,000 to purchase at
the time, but a bankrupt company was all
he could afford, Mohed said.
He took the risk as France underwent a
construction crisis and grew the company
with his own money.
“With the little money I saved as an employee before, I put it in the company and
that was enough to make it go on,” he told
The Edge Financial Daily in an interview after
he was announced the winner at the WEOY
2015 gala dinner at the Salle des Etoiles in
Monte Carlo on June 6.
According to Mohed, Altrad Group has
seen double-digit growth each year for the
last 30 years and the group never lost money.
“At the start, I reduced its development
instead of growing it. Turnover was about
10 million [French] francs at the time but I
reduced it to five million francs because that
was all I could finance. You can then grow
from five million francs to six million francs
and seven million francs and so on, but you
have to wait till things improve,” he said.
This patience and ability to work from
the ground up has much to do with Mohed’s
history. In his own words, “I used to live with
very little and I could revert to this.”
Mohed had a poor childhood, growing
up with his grandmother outside Raqqa, a
northern Syrian city. His grandmother forbade him from going to school as she envisioned him growing up to be a shepherd.
He still went nonetheless and spied on
the classroom through a hole in the wall. He
was soon allowed to sit in and proved to be
an excellent student.
Mohed went on to study in Raqqa and
earned a scholarship to France. He only
spoke Arabic at the time, but this did nothing to hinder the entrepreneur.
In France, he mastered French and English and eventually earned a PhD in Computer Science. He then worked for 15 years
in the telecommunications industry.
But Altrad Group isn’t his first successful venture.
After leaving the telecommunications
Previous World Entrepreneur of the Year winners
2014
India
Uday Kotak,>gmf\]j$=p][mlan]Na[];`YajeYfYf\
Managing Director of Kotak Mahindra Bank
*
()+
United States
Hamdi Ulukaya, Founder, President and CEO of
Chobani, Inc.
*
()*
Kenya
Dr. James Mwangi, CEO and Managing Director,
Equity Bank Limited
*
())
Singapore
Olivia Lum,=p][mlan];`YajeYfYf\?jgmh;=G$
@qÖmpDaeal]\
*
()(
United Kingdom Michael Spencer, Group CEO, ICAP plc
*
((1 Mainland China
Cho Tak Wong, Chairman, Fuyao Glass
Industry Group
*
((0 Switzerland
Dr. Jean-Paul Clozel, Founder,
Actelion Pharmaceuticals Ltd.
2007 Canada
Guy Laliberté, Founder and CEO, Cirque du Soleil
2006 South Africa
Bill Lynch, CEO, Imperial Holdings
2005 United States
Wayne Huizenga, Chairman, Huizenga Holdings, Inc.
*
((, Philippines
Tony Tan Caktiong, Chairman and President,
Jollibee Foods Corporation
2003 India
Narayana Murthy, Founder and Chairman, Infosys
Technologies Ltd.
2002 Germany
Stefan Vilsmeier, President and CEO, BrainLAB AG.
*
(() Italy
Paolo della Porta, President, Chairman and Group
CEO, Saes Getters S.p.A
industry in the mid-1980s, he started a company producing portable computers with a
university friend. These computers weighed
27kg.
The business did well as it built a programme for airport arrival and departure
boards in Arabic. However, Mohed soon sold
the business because he felt that he did not
have the funds to develop the company the
way he would have liked to.
What came next seems to have been left
in the hands of kismet.
Mohed stumbled on the bankrupt scaffolding company while on holiday with
his wife near the village of Montpellier. He heard about the company from
a neighbour.
“This company happened to be in
the same village where my wife was
born,” Mohed smiled. And
the rest, as they said, is
history.
In the next five to 10
years, Mohed hopes
to take Altrad to the
United States market.
“We have been concentrating on Europe
where the locations
are close [to each
other] and that
has made sense.
Mohed: With the
little money I
had saved as an
employee before,
I put it in the
company [Altrad]
and that was enough
to make it go on.
But of course we now want to move into the
United States,” Mohed said.
Altrad will do this the same way it has always done, by making strategic acquisitions.
In fact, Mohed said that in Malaysia alone
he had received offers from five scaffolding
companies looking to sell their businesses to
Altrad. However, he declined to give names.
“We get opportunities every day. We will
look into all these offers,” he said.
The group’s largest contributor is France
which consistently makes up some 35% of
the group’s turnover, followed by
the United Kingdom and Germany. It has a presence in 100
nations worldwide.
Aside from being a billionaire businessman, Mohed, who sleeps little, spends
his night-time writing novels.
His autobiography, Badawi which means Bedouin
or a nomadic Arab of the
desert, is taught in
the French education syllabus as part of
the literature
curriculum.
The EY
WEOY event
has been
running
since 2001
and the
number of
participating countries has been
growing steadily.
In the last 10
years, participa-
This year’s finalists — 65 of the
world’s best entrepreneurs from
53 countries — have:
Combined
revenues of
approximately
Average
revenues of
US$38b
US$720m
Average annual
revenue growth of
12%
Compared to a median annual growth rate on major
global indices in 2014:
• FTSE 100 — 1.9%
• S&P 500 — 5.4%
• Hang Seng — 6.6%
Combined revenue
growth in the last
three years
(2011–14) of
42%
Compared to median
growth rates on major
global indices over the
same period:
• FTSE 100 — 11.7%
• S&P 500 — 15.9%
• Hang Seng — 36.1%
tion has more than doubled, totalling 53
countries this year compared with 19 in the
inaugural year.
New entrants to the competition this year
were Belarus, Croatia, Peru and Romania.
Malaysia was represented by Goh Peng
Ooi, founder and group executive chairman
of Silverlake Axis Ltd.
The Singapore-listed company provides
banking software and systems to the Asia-Pacific region, the Middle East and Africa, and
now has a market capitalisation of over S$2.3
billion (RM6.44 billion).
The last time a Malaysian was crowned
on the global platform was in 2011. Olivia
Lum was the country winner for Singapore
that year, lauded for her Singapore-listed
company Hyflux Ltd.
Lum was an adopted child and had an
impoverished childhood in Kampar, Perak.
She founded Hyflux, a water desalination
company in 1989 with just S$20,000 capital.
Today, Hyflux has a global presence
and the company has a market capitalisation of S$685 million on the Singapore
Exchange.
1 2 P R O P E RT Y S NA P S H
T
Source: theedgeproperty.com
Sentul comes of age
Sentul non-landed residential average price
• Following from last week’s focus on Kuala Lumpur’s Jalan Ipoh, we take a
look at non-landed residences in the neighbouring Sentul area this week.
• The Sentul area has undergone extensive redevelopment over the past
decade with transformation of the area spearheaded by YTL Land &
Development Bhd’s Sentul Masterplan. The ongoing urban renewal
project is now home to a performing arts centre, parks and a number of
upmarket condominiums and office buildings. The Sentul masterplan
is divided between Sentul West and East, divided by railway lines.
Sentul East is in this week’s study while Sentul West was included in last
week’s focus on Jalan Ipoh.
• Elsewhere, vestiges of old Sentul remain with clusters of low-cost
apartments around the Sentul and Sentul Timur LRT Station while
matured housing estates can be found along Jalan Sentul.
• Based on theedgeproperty.com’s analysis of transactions, the average
price per square root (psf ) spiked in 3Q2014 to RM387 psf, up 17.5% y-y
on 3Q2013.
• This more than reversed the 2.3% y-y fall recorded in the preceding year.
• In contrast, transaction activity has been muted, with total transactions
for the 12 months to 3Q2014 falling 41.8% y-y from 328 to 191 units.
• However, analysis of data reveals that this may be because sales of the
successful launches of YTL’s The Capers and The Fennel in 2011 and
2013 respectively have yet to be reflected in the transaction data. These
two projects, located within the Sentul East development, set new
pricing benchmarks and are currently under construction.
Sentul non-landed residential volume
The Analytics are based on the data available at the date of publication and may be subject to further revision as
and when more data is made available to us.
For more of such information across Malaysia and Singapore, log onto the
theedgeproperty.com. The one-stop portal for all your property needs,
theedgeproperty.com offers price and transaction records, trend analysis,
research classifieds, and more – all for FREE!
Source: theedgeproperty.com
Aspen, OCBC Bank sign RM196m loan deal
to kick off Phase 1 of Aspen Vision City
KUALA LUMPUR: Aspen Group Holdings
Sdn Bhd, through its subsidiary Aspen Vision City Sdn Bhd, has signed a loan deal totalling RM196 million with OCBC Bank (M)
Bhd to finance the development of Phase 1
of the multibillion-ringgit Aspen Vision City
project in Batu Kawan, Penang.
The agreement features a term loan for
the purchase of land and a bridging loan for
the construction of the development.
The first phase of Aspen Vision City,
known as Verve, features a 35-acre (14.16ha)
gated and guarded commercial and business
district replete with 441 units of three- and
four-storey shop offices. With a gross development value of RM780 million, Phase 1 is
scheduled for completion in 2018.
Aspen Group chief executive officer
(CEO) Datuk Murly Manokharan said the
group is focusing the first phase of the Aspen Vision City project on building commercial properties to create a solid foundation for a thriving business hub, before
undertaking mixed development projects
in the second phase.
“It is important to get the first phase right
and we are pleased with the enthusiasm,
confidence and partnership shown by OCBC
Bank in helping us to get the project off the
ground on a firm footing. The first phase will
ensure that the development is economically viable and yields high returns for its
investors,” he said in a statement.
Bookings to date stand at over 85%, above
what Aspen Group had expected at this stage
of the exercise.
“We started the earthworks last month,
and we are excited about the progress we
are making,” said Murly.
OCBC Bank CEO Ong Eng Bin said the
bank is pleased to be at the forefront of a
China’s home prices
rise in May for first
time in 13 months,
outlook cloudy
BY C L A R E J IM
(From left) Rojkjaer, Murly, Penang Chief Minister Lim Guan Eng, Aspen Group chairman and executive
director Datuk Seri Nazir Ariff, Ong and OCBC Bank senior vice-president and head of corporate and
commercial banking Jeffrey Teoh at the loan signing ceremony last Wednesday.
visionary project that is set to revolutionise
the mainland of Penang.
“When we opened our own banking
branch in Batu Maung way back in 2006
— the first commercial bank in the area —
we had set our sights firmly on the Second
Penang Bridge becoming a catalyst to pave
the way for significant development in both
Batu Maung and Batu Kawan.
“Aspen Vision City represents the culmination of our own belief and confidence
in the development of this area, and we are
pleased to be playing our own part — nine
years after opening our branch on the other
side of the bridge — in kicking off the entire
project through this loan agreement for the
development of Verve,” he added.
Apart from Verve, Aspen Vision City also
features the first Ikea store and regional integrated shopping centre in the north, both
developed and managed by Ikano Pte Ltd.
Ikano managing director Christian Rojkjaer said it is preparing detailed planning
for an Ikea store and integrated shopping
centre there, with targets for completion in
2018 and 2020, respectively.
The entire Aspen Vision City project is
scheduled for completion in 2025, featuring
a mixed development spanning across 245
acres of freehold land in the Bandar Cassia
township, and is poised to become the next
integrated central business district of Penang.
HONG KONG: New home prices in China
rebounded nationwide for the first time in
13 months in May, suggesting a property
downturn is bottoming out after a barrage
of stimuli from the central bank and local
governments since late last year.
Economists, however, warned that massive inventories of unsold homes could
continue to drag on China well into next
year, discouraging new investment and
construction.
“Inventories in first-tier cities are back
to healthy levels ... but in third- and fourthtier cities, it will take at least two more
years,” said Rosealea Yao, an economist
at Gavekal Dragonomics in Beijing.
Average new home prices in China’s
70 major cities climbed 0.2% in May from
April, the first rise since May 2014, according to Reuters calculations based on official
data released last Thursday.
Weighed down by the cooling property
market and sluggish demand at home and
abroad, China’s economic growth slowed
to a six-year low of 7% in the first quarter,
and recent data showed the weakness
persisted into the second quarter, putting
more pressure to step up policy stimuli.
While signs of a stabilisation in prices
will ease strains on the economy and help
banks which are heavily exposed to the real
estate market, analysts said a full-blown
sectoral recovery is still a long way off.
Property investment growth slowed to
5.1% in January to May from a year earlier,
the slowest pace since 2009, while new
construction slumped 16%. — Reuters
B R O K E R S’ C A L L 17
Solid earnings visibility for Gamuda
Gamuda Bhd
(June 19, RM5)
Maintain buy with unchanged
target price of RM6: Positive kickers for Gamuda are looming: (i)
Penang Transport Master Plan’s
(PTMP) project delivery partner
(PDP) award, and (ii) the signing
of the Klang Valley Mass Rapid
Transit (KVMRT) 2 PDP agreement, that are both expected in
June/July this year.
Gamuda could be one of the
front runners for the PTMP PDP
role, based on its experience as a
co-PDP for KVMRT 1. Besides the
PDP role, Gamuda is also eyeing
PTMP’s civil construction works.
As for the KVMRT 2, the likely
positive outcomes from the final
PDP agreement include: (i) the
project value which could be higher than RM23 billion; and (ii) the
PDP fees which could be maintained at 6%, similar to KVMRT 1.
Meanwhile, results for the third
quarter of financial year 2015 ending July (3QFY15) due on Tuesday,
should be in line.
Clinching the PTMP PDP role
and higher PTMP and KVMRT 2
project values could boost stock
sentiment. The PTMP and KVMRT 2 works would level up Gamuda’s order book to a record high.
We estimate potential job wins
from PTMP and KVMRT 2 could be Gamuda Bhd
equivalent to 6.8 times its trailing
construction annual revenue. This FYE JULY (RM MIL)
would give longer-term earnings Revenue
visibility to Gamuda’s construc- Ebitda
tion division.
Core net profit
There is no change to our earn- Core EPS (sen)
ings forecasts. We reiterate Gamu- Core EPS growth (%)
da as our top pick for the construc- Net DPS (sen)
tion sector with an unchanged Core PER (x)
revalued net asset value-based
P/BV (x)
target price of RM6. We think the
Net dividend yield (%)
implied valuation of our target
price at 21 times 2016 price-earn- ROAE (%)
ings ratio, still below its 23 times ROAA (%)
one standard deviation above EV/Ebitda (x)
mean, is justified. — Maybank IB Net debt/equity (%)
Source: Maybank IB Research
Research, June 19
2013A
2014A
2015E
2016E
2017E
3,883.1
650.7
630.1
29.5
11.8
9.0
17.0
2.2
1.8
14.1
7.4
17.6
22.5
4,636.4
775.2
712.2
31.0
4.9
12.0
16.2
2.1
2.4
13.8
7.6
17.2
30.1
2,664.2
611.3
719.5
31.0
(0.0)
12.0
16.2
2.0
2.4
12.6
6.8
22.2
19.8
2,527.7
620.0
663.3
28.6
(7.8)
12.0
17.6
1.9
2.4
10.9
5.9
21.6
14.7
2,579.2
613.5
652.4
28.1
(1.6)
12.0
17.9
1.7
2.4
10.1
5.5
22.0
14.7
THE EDGE FILE PHOTO
Indonesia to weigh
on CIMB’s profit
CIMB Group Holdings Bhd
(June 19, RM5.53)
Maintain hold with an unchanged
target price of RM6: The outlook
for 2015 is challenging. The bleak
outlook for CIMB’s Indonesian operations will continue to weigh on
the group’s earnings. CIMB Niaga
accounts for about 30% of CIMB
Group’s pre-tax profit, but this fell
to 19% in financial year 2014 (FY14)
due to heavy provisioning. In addition, capital markets are expected to
be soft, which would limit CIMB’s
ability to leverage its strong investment banking franchise.
Although CIMB’s Target 2018
(T18) strategy paints a positive picture for the group for the longer
term, these new initiatives could
further dampen earnings in the near
term, before recovering once cost
issues are resolved. The T18 initiatives aim to reduce cost-to-income
ratio to below 50%. Supplemented
by consumer banking to eventually contribute 60% of income, this
would eventually lift return on equity (ROE) to over 15% by end-FY18.
Provisions were the main culprit
for CIMB’s weak earnings in the past
few quarters, and are expected to
persist up to the second quarter (2Q)
of FY15, especially at the Indonesian
operations. To recap, 1QFY15 results
came in at only 14% of our full-year
earnings and we expect a weak 2Q
before earnings stabilise in the second half of the year. Given that 2015
is a restructuring year under the T18
strategy, there will be one-off costs
booked for staff and business rationalisation measures. On the whole,
while we forecast 10% loan growth
for 2015, this will be mitigated by
lower net interest margin, which
would cap top line growth.
CIMB is a “hold” with a RM6
target price based on the Gordon
Growth Model, implying 1.3 times
forecast FY15 book value. Our target price assumes 12% ROE, 5%
long-term growth and 10% cost of
equity. We believe the share price
will not be rerated until there is a
clearer indication of a pickup in its
earnings momentum.
We have imputed a weak year
for CIMB’s Indonesian operations,
so a better-than-expected improvement would pose upside risk to our
earnings forecasts.
Meanwhile, a sharp pickup in
capital market activities in Malaysia
would also boost earnings. — Alliance Research, June 19
CIMB Group Holdings Bhd
FYE DEC (RM MIL)
Pre-prov profit
Net profit
Net profit (pre ex)
EPS (sen)
EPS pre ex (sen)
EPS growth (%)
EPS growth pre ex (%)
Diluted EPS (sen)
PER pre ex (x)
Net DPS (sen)
Div yield (%)
ROAE pre ex (%)
ROAE (%)
ROA (%)
BV per share (sen)
P/BV (x)
2014A
2015F
2016F
2017F
5,756
3,107
3,009
38.5
37.3
(36)
(30)
36.9
14.8
15.0
2.7
9.1
9.4
0.8
444
1.2
5,788
3,649
3,649
42.7
42.7
11
15
42.1
12.9
17.0
3.1
9.7
9.7
0.9
454
1.2
6,530
4,231
4,231
48.0
48.0
13
13
47.3
11.5
19.0
3.4
10.4
10.4
0.9
488
1.1
7,294
4,772
4,772
52.6
52.6
9
9
51.8
10.5
21.0
3.8
10.6
10.6
0.9
524
1.1
Source: Company, AllianceDBS, Bloomberg Finance LP
A possible higher
levelised tariff and the
imbalance cost passthrough mechanism
would address the
costs involved in the
takeover.
TNB taking over Jimah power plant
Tenaga Nasional Bhd
(June 19, RM12.86)
Maintain buy with unchanged
target price of RM17.50: Tenaga
Nasional Bhd’s (TNB) share price
fell 4% on June 18 on news reports
that TNB is taking over 1Malaysia
Development Bhd’s (1MDB) entire
stake in the Jimah power plant.
Details are lacking, but we are cautiously optimistic. A possible higher
levelised tariff and the imbalance
cost pass-through (ICPT) mechanism would address the costs involved, in our view. Maintain “buy”
on TNB with an unchanged target
price of RM17.50.
We are cautiously optimistic
about the possible TNB takeover
of the 2,000mw Jimah coal-fired
power plant (Track 3B project).
Details are lacking, but reported
comments made by the energy
minister suggest that TNB is to
take over 1MDB’s entire stake in
the Track 3B project and seek a
small revision for a higher levelised
tariff to account for project delays
and foreign exchange fluctuations.
TNB may need to take into account
its higher weighted average cost of
capital (WACC) of 8% compared
to 1MDB’s lower WACC (around
mid-single digits).
TNB has only said it has yet to
receive any official notification from
the government. As it stands, Track
3B has an existing levelised tariff of 25.33 sen/kWh. Time is running short as the original commercial operation dates (split into two
Tenaga Nasional Bhd
FYE AUG 31 (RM MIL)
Revenue
Ebitda
Pre-tax profit
Net profit
EPS (sen)
PER (x)
Core net profit
Core EPS (sen)
Core EPS growth (%)
Core PER (x)
Net DPS (sen)
Dividend yield (%)
EV/Ebitda (x)
Affin/Consensus (x)
2013
2014
2015E
37,130.7
10,555.5
5,925.1
5,356.2
94.9
14.7
4,841.3
85.8
39.5
16.3
25.0
1.8
8.7
-
42,792.4
11,467.1
7,114.7
6,467.0
114.6
12.2
5,436.1
96.3
12.3
14.5
25.0
1.8
8.4
-
44,000.9
13,357.9
7,839.6
7,097.5
125.8
11.1
7,097.5
125.8
30.6
11.1
29.9
2.1
7.0
1.1
2016E
2017E
45,352.1 46,643.5
13,769.8 14,184.8
8,136.4 8,452.9
7,366.3
7,652.9
130.5
135.6
10.7
10.3
7,366.3
7,652.9
130.5
135.6
3.8
3.9
10.7
10.3
32.4
35.1
2.3
2.5
6.6
6.2
1.1
1.1
Source: Company, Affin Hwang forecasts
phases) are November 2018 and
May 2019, which suggests that TNB
would likely receive a higher tariff to
prevent a power generation capacity shortfall. Track 3B was initially
reported to cost RM11 billion. The
remaining 30% in Track 3B will still
be held by Mitsui Co Ltd.
We believe the ICPT mechanism
would be used to address the potential higher tariff for Track 3B. In
other words, the additional costs
associated with Track 3B may be
passed on to consumers under the
generation-specific cost adjustment
portion of the ICPT. However, this
may not necessarily translate into
higher electricity tariffs going forward, as these costs may be offset
by TNB’s over-recovery of fuel costs
due to minimal use of expensive
imported liquid natural gas and
soft coal prices.
Pending further clarification
from management, we maintain
our “buy” rating on TNB with an
unchanged discounted cash flowbased 12-month target price of
RM17.50 (WACC: 8%, lomg-term
growth: 3%). We still like TNB for: (i)
decent electricity sales growth; (ii)
benign coal prices and (iii) indirect
ICPT implementation. However,
the lack of clarity on Track 3B and
persistent overhang from 1MDB
bailout speculation are potential
headwinds. — AffinHwang Capital
Research, June 18
20 H O M E
Why flood
victims are still
living in tents
SHAH ALAM: The Works Ministry
has reiterated that there is no delay
in the construction of permanent
houses for flood victims in Kelantan, and the process is constantly
being monitored.
Deputy Works Minister Datuk
Rosnah Abdul Rashid Shirlin said
the claims by certain parties that
the projects are delayed are not
true because another 100 units
are due for completion in time
for Aidilfitri next month.
She said the ministry is in constant contact with the contractors
to ensure that the construction
schedule is being observed.
Repair works on all the damaged houses are almost completed, she added.
“If there are any delays, they
are because the flood victims do
not have their own land to build
the new houses, and the [Kelantan] state government is having
trouble giving us the suitable land.
“The federal government feels
that if the state government remains hesitant about providing
land to its people, then we will
consider buying the land for the
sake of the flood victims,” she told
reporters here yesterday.
She said that options are still
being discussed, and the federal
government is still waiting for the
move by the Kelantan state government to provide land that is
suitable for the housing projects.
— Bernama
Eight pirates
being extradited
by MMEA
KUALA LUMPUR: The Malaysian
Maritime Enforcement Agency
(MMEA) has began the process
to extradite the eight suspected
hijackers of MT Orkim Harmony
from Vietnam.
Deputy director-general (operations) Vice-Admiral Datuk
Ahmad Puzi Abdul Kahar said
the Vietnamese authorities had
confirmed that the eight suspects
admitted committing the offence.
He said the MMEA had so far
handled five armed robbery cases, involving 40 accused who are
now serving time for committing
the offences.
Meanwhile, he urged all quarters not to make speculations that
could affect the investigations.
He said the agency’s forensic
officer had started collecting evidence from MT Orkim Harmony,
and statements were being recorded by the investigating officer from
witnesses on the vessel.
He was commenting on a
newspaper report, which claimed
the hijacking was an inside job.
He said the crew of MT Orkim
Harmony are being given counselling to overcome their trauma
by the Armed Forces Hospital and
Mercy Malaysia.
MT Orkim Harmony was laden with 6,000 tonnes of petrol
worth RM21 million, when it lost
communication with the base at
8.57pm on June 11. — Bernama
‘A good thing
that Pakatan did not
take over Putrajaya’
It might have faced a crisis if it had won GE13, says Kit Siang
PETALING JAYA: Pakatan Rakyat
might have faced a crisis within its
ranks if it had succeeded in taking
over Putrajaya in the last general
election.
DAP stalwart Lim Kit Siang said
this was because PAS president Datuk Seri Abdul Hadi Awang had never
accepted Datuk Seri Anwar Ibrahim
as the now defunct opposition pact’s
candidate for prime minister.
“In fact, the Pakatan Rakyat crisis
might have come even earlier if Pakatan Rakyat had been successful
in winning the majority of the parliamentary seats in the 13th general
election two years ago, as Hadi had
never accepted Anwar as the Pakatan candidate to be prime minister
of Malaysia,”he said in a statement.
Last year, PKR’s Mohd Rafizi Ramli
said that PAS, led by Hadi, had rejected Anwar as the now defunct pact’s
candidate for prime minister and
had instead, proposed to nominate
Umno’s Tan Sri Tengku Razaleigh
Hamzah for the top post.
Training his gun at Hadi, Kit Siang
said PAS’ resolution at its recently
concluded muktamar (general assembly) to cut ties with DAP was
the “last straw that breaks the camel’s back”.
This was because for a year, Pakatan existed in name only because
Hadi had violated the coalition’s principles — the Pakatan common policy
framework and the consensus operational principle — that the agreement of all three component parties
is needed for any Pakatan motion to
be made and that no single leader
had the veto power to override the
decisions of the Pakatan leadership
council.
“Hadi not only violated the Pakatan common policy framework but
acted in utter disregard of the Pakatan
consensus operational principle, as if
he could override decisions taken by
the Pakatan leadership council in the
same way he had no qualms about
overriding decisions taken by the PAS
central working committee,” he said.
The Gelang Patah member of parliament said that while the people
may be sad about Pakatan ceasing to
exist, there is no reason to be gloomy
about the future political prospects.
— The Malaysian Insider
Palanivel in more hot soup
as summoned by PM
KUALA LUMPUR: Prime Minister
Datuk Seri Najib Razak will seek an explanation from Datuk Seri G Palanivel
(pic), after the embattled MIC president blamed the PM for MIC’s crisis.
Posting on his official Facebook
and Twitter accounts,
Najib, in a brief update, also
told the natural resources
and environment minister
to stop heaping the blame
on others for the troubles
of MIC.
“I’ll summon G Palanivel to explain his reported comments at [the]
PWTC (Putra World Trade Centre).
He should stop blaming others and
must abide by the decision of the
courts and [the] RoS (Registrar of
Societies),” Najib wrote on his Twitter account, which tagged Palanivel.
Najib’s posting was retweeted by
Defence Minister Datuk Seri Hishammuddin Hussein.
At a rally to declare support for
him at the PWTC on Saturday, Palanivel said Najib
sided with the RoS and put
pressure on MIC to reject
the party elections held in
2013.
“Barisan Nasional and
the PM himself got involved in putting pressure
on MIC to reject the results
of our validated 2013 elections and
for the party to take sides with our
detractors,” he said.
The MIC saga erupted following
differences between Palanivel and his
deputy Datuk Seri Dr S Subramaniam,
after the RoS issued a notice on Dec 5
directing the party to hold fresh polls
for the three vice-presidential and 23
central working committee posts.
The RoS nullified the November
2013 elections following complaints
of irregularities.
Palanivel took his case to the High
Court, but both judicial review applications to quash the RoS directive
were dismissed last Monday.
The court upheld the RoS’ decision
for the party to hold re-elections at
all levels (branches and divisions),
including the president post.
The crisis also saw both Palanivel
and Subramaniam claiming to be
party chief. — The Malaysian Insider
Dr M: Najib afraid of criminal charge
KUALA LUMPUR: Tun Dr Mahathir
Mohamad has unleashed another
scathing attack on Datuk Seri Najib
Razak, saying it is likely that the prime
minister’s refusal to step down is because he fears being hauled to court.
The former prime minister, at a
forum held at the Perdana Leadership Foundation, said that as long as
Najib remains in power, the country
will deteriorate and remain unstable.
“I have given advice, I have even
threatened [him], but he said he won’t
quit, and because he can’t quit, I think
he is scared. Maybe he might face a
criminal charge if he quits,” he said.
This, Dr Mahathir said, is related
to the RM42 billion debt incurred
by 1Malaysia Development Bhd
(1MDB).
“Where did the money go? He can
say that it is for investments, but there
is no proof ... apart from buying lands
at a cheap price and power plants at
higher prices,” he said.
“There is so much wrongdoing
... and because of that, I feel that if
Najib continues to stay in power, the
country will deteriorate, will be in
trouble and unstable, and no longer
a place where we can live comfortably,” he said.
Dr Mahathir said that was one
of the reasons why he announced
months ago that Najib should resign,
but lamented that there are still many
who do not understand the issues
surrounding 1MDB.
“It’s hard to imagine RM1 billion
... even RM1 million the Malays have
yet to see. That is why many just take
things easy and brush it off,” he said.
Dr Mahathir’s comments echoed
those made in an interview he gave
to The New York Times last week,
where he was quoted as saying that
what Najib is doing is “verging on
criminal”. — The Malaysian Insider
IN BRIEF
Trafficking victims
to be laid to rest today
PENDANG, Kedah: The 21 remains of victims of human trafficking, believed to be illegal
Rohingya migrants from Myanmar, found in a detention camp
in Perlis, will be buried today.
Kedah Menteri Besar Datuk Seri
Mukhriz Mahathir said the remains will be buried in Kampung
Tualang, Pokok Sena, following
the completion of the post-mortem at Sultanah Bahiyah Hospital in Alor Setar. The funeral
will be managed by the Kedah
Islamic Religious Department
and the funeral costs incurred
by the National Security Council. — Bernama
Earthquake safety
zone mulled for safety
KOTA KINABALU: The measure
to create safety zones in villages
hit by the earthquake on June 5 in
Kota Belud is the best way to ensure the safety of the population.
Sabah Mineral and Geoscience
Department director Mustafar
Hamza said the measure proposed by district officer Abdul
Gari Itam took into account all
aspects of security for those living
in the area. The critical areas are
villages in the foothills of Mount
Kinabalu, namely Kampung Kiau
Teburi, Kampung Kiau Nuluh and
Kampung Kiau Bersatu, which
were badly damaged. — Bernama
Malaysia to hold first
MH17 anniversary
IPOH: Malaysia will hold the first
anniversary to commemorate
the tragedy involving the crash
of Malaysia Airlines flight MH17,
which was shot down in Eastern Ukraine on July 17 last year.
Transport Minister Datuk Seri
Liow Tiong Lai said the Netherlands and Australia will also hold
similar anniversaries. Malaysia
Airlines will bear the expenses
for families of victims wishing
to attend the memorial in the
Netherlands. He said the interim
report should be released before
the anniversary. — Bernama
Arsonists target
DAP office in George Town
GEORGE TOWN: The front door
of Padang Kota assemblyman
Chow Kon Yeow’s service centre at Kompleks Jalan Kedah
was burnt yesterday. Timur
Laut district police chief ACP
Mior Faridalatrash Wahid said
burn marks on the aluminium
door were discovered by Chow’s
aide, who then informed police.
Closed-circuit television camera
footage shows a man burning
something at the door at 3.40pm.
— Bernama
266 illegals immigrants
detained by NSC
KOTA KINABALU: A total of 266
illegal immigrants were detained
here and in Penampang during
a two-day integrated operation
by the Sabah National Security
Council (NSC), which ended on
Saturday. Sabah NSC secretary
Mohd Rodzi Md Saad said the
immigrants were sent to the Kota
Kinabalu Temporary Detention
Centre. — Bernama
22 C O M M E N T
Battling ‘Flash Boys’ in Asia
Norway wealth fund cuts back on use of algorithmic trading to dodge HFT traders
BY SA L EH A MOHSIN
N
orway’s US$890 billion (RM3.33 trillion) fund, which
considers high-frequenc y trading
(HFT) a scourge in
global financial markets, is taking steps to avoid the practice as
it spreads in Asia.
The fund, which owns about 1.3%
of the world’s equities, has already
started to cut back on its use of algorithmic trading to dodge HFT traders
who might be trying to pre-empt its
moves in the United States.
HFT “is now gaining some mo-
mentum in Asia — we’re definitely following it and we have to do a
lot of work on the individual markets,” said Oeyvind Schanke, head
of asset strategies at the fund. “The
whole spectrum of trading venues
has been catering to high-frequency
trading activity, whereas we would
like it to focus more toward the institutional need.”
Schanke has 10 people working
in Oslo, the fund’s main office, and
in hubs in New York, London and
Singapore, looking for ways to cut
transaction costs and retain profits
when trading in large blocks. Now,
he’s worried about markets such
as Japan.
Michael Lewis drew attention to
the concept of “Flash Boys” with his
2014 book by the same name, which
argued that HFT firms armed with
powerful computers and the fastest connections to exchanges were
picking off other investors’ trades.
Norges Bank Investment Management, which runs the wealth
fund as part of the central bank of
Norway, held about US$90.2 billion in Asian stocks at the end of
last year. It holds US$511.5 billion
in stocks globally and is Europe’s
biggest equity investor. The fund’s
stock holdings returned 7.5% in the
first quarter, while the total portfolio
rose 5.3%.
Slow trading
Critics like Schanke say HFT harm
other investors by sniffing out
their strategies and completing
the juiciest trades first. Large investors break up their big stock
trades and execute them over the
course of minutes or hours to disguise their plans.
But if the big investor keeps
pumping orders into the market
for hours, HFT firms switch roles:
They start mimicking trades, making it more costly for them to buy or
sell, according to a new paper from
VU University Amsterdam’s Vincent
van Kervel and Albert J Menkveld.
Norway’s fund for the first time
provided trade data for the study,
along with three other investors.
Schanke, who oversees decisions
on the companies and instruments
the fund invests in, generally prefers
slow trading for big orders.
“We could choose to wait four
days before we execute in the hope
that during the course of those four
days we will find a natural counterparty to cross this up with,” he said.
“We would rather decrease the impact costs and take the opportunity
cost risk that arises from it.”
Schanke said as a long-term investor, it’s worth the wait. “That’s
what the numbers show.” —
Bloomberg
Rising unemployment piles up problems for Jokowi
BY EVEL I N E DA NUBRATA
& C I N DY SI LVI A NA
JAKARTA: Indonesian companies
are shedding jobs as they grapple
with the weakest economic growth
in six years, adding to the troubles facing President Joko Widodo (Jokowi), who was elected last
year on pledges to dig the country
out of a rut.
Government data might suggest no cause for alarm — unemployment was 5.81% in February,
up only slightly from 5.70% a year
earlier — but the official numbers
are notoriously unreliable and don’t
adequately cover the informal sector, which is two-thirds of Southeast
Asia’s biggest economy.
Recent reports of heavy lay-offs
across the country paint a bleaker
picture, and business executives,
recruitment firms and jobseekers
say it is getting worse.
Young people are hit the hardest; the International Labour Organization estimated the youth
jobless rate was more than 20% in
2013, and economists believe it is
higher now.
About a third of the workforce
is aged 15 to 29, a youth bulge that
could bring Indonesia, a country
of 250 million people, the sort of
demographic dividend China and
South Korea enjoyed a generation
ago — but only if there are jobs for
the two million people joining the
workforce every year.
“The government doesn’t have
a blueprint for labour absorption,”
said property businessman Hariyadi Sukamdani, chairman of the
Indonesian Employers’ Association.
“If this condition is allowed to
continue, what we would get is not
a demographic bonus, but a demographic disaster. There could be social turmoil and higher crime rates.”
Jobless In Jakarta
When he took office eight months
ago, Jokowi said he would pour billions of dollars into infrastructure
and foster growth in manufacturing.
But the promised splurge on
Indonesian youths filling up job application forms on laptops provided by organisers at the Indonesia Techno Career in Jakarta on June 11. The International Labour Organization
estimated the youth jobless rate was more than 20% in 2013, and economists believe it is higher now. Photo by Reuters
roads, power plants and ports has
not materialised, largely because
of bureaucratic hold-ups and land
disputes, and a shortage of skilled
labour is holding back growth in
value-added industries.
Miners have been hammered
by a double whammy: a ban on
mineral ore exports and a sharp
drop in commodity prices.
Meanwhile, labour-intensive industries such as textiles and manufacturing have been hit by the rupiah’s slide to a 17-year-low, which
has raised the cost of imported raw
materials.
Hundreds of redundant garment
factory workers protested for hours
this week in the financial district
of Jakarta, the capital, after their
company was declared bankrupt
and its assets seized by two banks.
Unemployment in turn is hitting consumption, which makes
up more than half of Indonesia’s
economy. Automobile sales in May
fell 18.4% from a year earlier, the
ninth decline in a row.
“Stocks are piling up because
nobody is buying. The people’s purchasing power is weak,” said Ade
Sudrajat, head of Indonesia’s textile
association. “This has never happened before in the last 45 years.”
Expat Exit
Arif Budimanta, adviser to the finance minister, said the government was introducing measures
such as halving lending rates for
small businesses and exempting
most goods from a luxury tax to
stimulate consumption.
At job fairs in Jakarta the gloom
is palpable.
Naomi Octiva Naibaho, a manager at the Kompaskarier.com portal that ran one such fair recently,
said about 6,000 jobseekers turned
up every day, roughly triple the
number of positions on offer.
Gita Harahap, 26, has been sending resumes for weeks since the
bank where she worked as a teller
started a round of lay-offs, but she
has had no luck. “No one has called
me back,” she said. “The competition is tighter.”
In the first five months of this
year, 79 companies approached
Universitas Indonesia for potential
recruitment, down from 110 over
the same period of 2014, said San-
dra Fikawati, head of the university’s career development centre.
The slowdown is also affecting
higher-paid jobs, including in financial services, said Rob Bryson,
Indonesia country manager for
recruitment firm Robert Walters.
From mid-2013 to late last year,
the number of foreigners holding
work permits in Indonesia is estimated to have dropped 20% to
around 62,000, partly because expatriate jobseekers saw more opportunities in Western countries,
he said.
“Companies here are looking to
increase productivity,” Bryson said.
“They will happily hire one person
and let go of two in many circumstances, so that adds pressure to
the employment scene.” — Reuters
24 H O M E B U S I N E S S
WEEK
IN FOCUS
Photos by Shahrin Yahya,
Kenny Yap & Sam Fong
1
Masterskill Education Group
Bhd (MEGB) executive director
Datuk Dr R Palan (left) and Asia
Metropolitan University bursar
Kuhan Jeganathan at MEGB’s
extraordinary general meeting
in Kuala Lumpur last Friday.
2
(From left) Mah Sing Group Bhd
chief executive officer (CEO)
Ng Chai Yong, group managing
director and group CEO Tan Sri
Leong Hoy Kum and executive
director Datuk Steven Ng Poh
Seng at the company’s annual
general meeting in Kuala Lumpur last Thursday.
3
EWI SEEKS MAIN MARKET LISTING ... Eco World Development Group Bhd president and chief executive officer (CEO) Datuk Chang Khim Wah, chairman Tan
Sri Liew Kee Sin, Eco World International Bhd (EWI) president and CEO Datuk Teow Leong Seng and Eco World executive director Liew Tian Xiong at a media briefing to announce
EWI’s plans for a direct listing on Bursa Malaysia’s Main Market in Kuala Lumpur last Wednesday.
Malaysia Petroleum Resources
Corp senior vice-president Syed
Azlan Syed Ibrahim (left) and
executive director Dr Mohd
Shahreen Zainooreen Madros
at the company’s media briefing in Kuala Lumpur on June 10.
4
(From left) Malaysia Building
Society Bhd (MBSB) chairman
Tan Sri Abdul Halim Ali, president and chief executive officer
Datuk Ahmad Zaini Othman,
YBK Usahasama Sdn Bhd executive director Mohamed Tamin
Mohamed Yusof and executive
chairman Datuk Zainal Abidin
Sakom after a signing ceremony for a RM250 million Tawarruq refinancing facility between
MBSB and YBK Usahasama in
Kuala Lumpur on June 8.
5
1
2
(From left) Standard Chartered
Bank Malaysia Bhd chief executive officer Mahendra Gursahani, Malayan Banking Bhd
group head of global banking
Amirul Feisal, Sunway Group
corporate adviser Tan Sri Ramon Navaratnam, RHB Banking
Group group chief strategy and
transformation officer/deputy
group chief risk officer Christopher Loh, and AmBank Group
chief financial officer Mandy
Jean Simpson at the 19th Malaysian Banking Summit in Kuala
Lumpur last Wednesday.
6
3
4
5
6
(From left) IHH Healthcare Bhd
managing director and chief executive officer Dr Tan See Leng,
chairman Tan Sri Dr Abu Bakar
Suleiman and chief financial
officer Tan See Haw at the company’s annual general meeting
in Kuala Lumpur last Monday.
W O R L D B U S I N E S S 25
Hudson’s Bay wangles way back to Teutonic roots
BY ROB ERT COL E
LONDON: Hudson’s Bay was originally set up in 1670 by English royal
charter and headed by a German
cousin of the reigning Charles II.
Lately it has existed as a Canadian company with a North American presence. Now, though, Hudson’s Bay has wangled a way back
to its Teutonic roots with a US$3
billion (RM11.22 billion) deal to
buy Cologne-based retailer Galeria Kaufhof.
The enterprise value (EV) of the
transaction, Hudson’s Bay said last
Monday, is equivalent to 8.6 times
Kaufhof’s earnings before interest,
Shale industry
could be
swallowed by
its own debt
BY A SJY LY N LODER
NEW YORK: The debt that fueled the US shale boom now
threatens to be its undoing.
Drillers are devoting more
revenue than ever to interest
payments. In one example,
Continental Resources Inc, the
company credited with making
North Dakota’s Bakken Shale
— one of the biggest oil-producing regions in the world,
spent almost as much as Exxon Mobil Corp, a company 20
times its size.
The burden is becoming
heavier after oil prices fell 43%
in the past year. Interest payments are eating up more than
10% of revenue for 27 of the 62
drillers in the Bloomberg Intelligence North America Independent Exploration and
Production Index, up from a
dozen a year ago. Drillers’ debt
ballooned to US$235 billion
(RM878.9 billion) at the end
of the first quarter (1Q), a 16%
increase in the past year, even
as revenue shrank.
“The question is, how long
do they have that they can get
away with this,” said Thomas
Watters, an oil and gas credit
analyst at Standard & Poor’s in
New York. The companies with
the lowest credit ratings “are in
survival mode,” he said.
The problem for shale drillers
is that they’ve consistently spent
money faster than they’ve made
it, even when oil was US$100 a
barrel. — Bloomberg
taxes, depreciation and amortisation (Ebitda) last year. The Canadian group trades on an equivalent
multiple of about 12 times, Thomson Reuters data shows. That helps
the financial consequences of the
deal look benign for Hudson’s Bay.
The company has also agreed to
sell 40 or more Kaufhof stores to a
joint venture (JV) it operates with
Simon Property. Assuming the JV
can raise the funds it needs to buy
them and other conditions are satisfied, this second deal will largely
finance the Kaufhof purchase for
Hudson’s Bay. It’s a neat two-step
that pleased investors sufficiently
to add 8% to Hudson Bay’s market
capitalisation, raising it to around
US$4.7 billion.
Metro, Kaufhof’s current owner,
has come off second-best to the
venerable fur trader-turned-retailer, at least if a 5% drop in its stock
price is anything to go by. Sure,
the disposal is at a premium to its
own EV-to-Ebitda multiple, and it
allows Metro to focus its resources
on its supermarket, cash and carry,
and electrical retailing businesses.
A sale to a rival like the owner of
Karstadt, Germany’s second-largest
department store could, however,
have been worth more because of
the potential for cost cuts. Metro instead opted for certainty, avoiding
a tough discussion with German
trade unions and perhaps competition concerns. Also, a local deal
might not have come with the same
real estate-related sweetener.
Hudson’s Bay anticipates higher
operating cashflow and a reduction
in its debt-to-Ebitda ratio as a result of the Kaufhof purchase and
subsequent real estate sale. While
it expanded into high-end US department stores with the purchase
of Saks two years ago, it’s a while
since the company had to serve
customers in the Old World. The
financial cushion may prove useful
against the risks involved in rediscovering Europe. — Reuters
Greece says ready
to reach debt deal
Calls for Merkel’s ‘clear decision’ at today’s emergency summit
BY SOP HIE M A K RI S
ATHENS: Greece on Saturday said
it would present new proposals to
its EU-IMF creditors to reach a debt
deal as the country’s outspoken finance minister called on German
Chancellor Angela Merkel to make
a “clear decision” at today’s emergency summit.
European Union heads are waiting for Greece’s anti-austerity government to present new economic reform and budget proposals,
and Greek Minister of State Alekos Flambouraris said on Saturday
Athens would propose reworked
measures.
The pressure has mounted on
Greece ahead of an emergency
summit of the leaders of the 19
countries in the euro area today
in Brussels.
But the country’s Finance Chief
Yanis Varoufakis, whose flamboyant style has irked many of his European counterparts, turned the
tables by putting the onus on the
leader of paymaster Germany to
make a deal.
Merkel can “enter into an honourable agreement with a government, which has rejected the
‘rescue package’ and is seeking
a negotiated solution, or follow
the calls from [those in] her gov-
NEW YORK: US health insurer Anthem Inc said yesterday it had offered
US$47 billion (RM175.78 billion) in
cash and stock for smaller rival Cigna
Corp, signalling a pickup in the industry’s long-awaited consolidation.
The biggest US health insurers are
seeking acquisitions to boost mem-
bership in government-paid healthcare plans and the employer-based
insurance that is Cigna’s specialty.
Being bigger can help them negotiate
better prices and improve networks
of doctors, they said.
Anthem’s offer comes as Cigna,
as well as insurer Aetna Inc, are
participating in an auction to acquire another rival, Humana Inc,
Italian prosecutors seek
trial for Bank of China
and 297 individuals
FLORENCE (Italy): Prosecutors
in Florence have formally asked
for Bank of China’s Milan branch
and 297 individuals, mostly Chinese living in Italy, to be tried
for smuggling money and other crimes. The document stems
from an investigation called “River of Money” that started in 2008
and points to the growing influence of Chinese criminal groups
in Italy’s Tuscany region. Investigators said money sent to China
through agencies of the Money2Money (M2M) transfer service
in several Italian cities included
proceeds from crimes such as
counterfeiting, embezzlement,
exploitation of illegal labour and
tax evasion. — Reuters
Self-storage industry
in Asia to rapidly expand
— CBRE
SINGAPORE: The self-storage
industry is rapidly expanding in
Asia, fulfilling market demand
for more storage space, a new
report by global real estate services firm CBRE said, The Straits
Times reported. “Consumer demand is strong, due to a range
of drivers such as disruptive life
events, urbanisation and changes in business activity, with cities
such as Tokyo, Hong Kong and
Singapore leading the trend,”
CBRE said in a release. Investors
are becoming more interested
in self-storage as an alternative
asset class, as seen by the huge
success of the recent Self-Storage
Expo Asia, which drew in some
200 participants, CBRE noted.
Apple to become key
news business industry
player with revamped app
Varoufakis arriving for a governmental council at the Prime Minister’s Office in
Maximos mansion in Athens on Saturday. Varoufakis, whose flamboyant style has
irked many of his European counterparts, turned the tables by putting the onus on the
leader of paymaster Germany to make a deal. Photo by Reuters
ernment who want her to throw
overboard the only Greek government which has been faithful to
its principles and which is able to
take the Greek people on the road
to reform,” said Varoufakis in an
article that appeared in the German press yesterday.
German public opinion has
soured on Greece after five months
of contentious negotiations, with a
recent poll showing 51% now believes
Athens should leave the eurozone.
But the leftist Greek government
insists it will present compromises that should bring Athens and its
creditors — European Commission,
International Monetary Fund (IMF)
and European Central Bank (ECB)
— closer to agreement on freeing
up €7.2 billion (RM30.57 billion) in
blocked bailout funds Greece desperately need to meet looming debt payments to the IMF and ECB. — AFP
Anthem offers US$47b for Cigna
BY C A ROL I NE HU MER
IN BRIEF
according to a person familiar with
the matter, who asked not to be
identified because the sale process is confidential. Humana was
first reported to be considering a
sale in May.
Humana declined to comment.
Aetna was not immediately available for comment. Cigna declined to
comment on the Humana auction
or the Anthem offer.
Anthem, the second largest US
health insurer, said in a statement
it had made four offers for Cigna in
June, but that the deal was stalled
over Cigna chief executive David
Cordani’s role in the merged company. The Wall Street Journal first
reported on the rejected offers last
week. — Reuters
WASHINGTON: Apple is diving deeper into the news business with a new application that
could make the US tech giant a
key industry player. Apple News,
part of the upcoming iOS 9 operating system, aims to be the
primary news source for users of the iPhone and iPad —
likely at the expense of sources
such as Facebook, Google and
news apps such as Flipboard.
In a surprising move, Apple has
unveiled it will be hiring experienced journalists to manage
its newsfeeds — marking a departure from the algorithmic
process used by rivals. — AFP
New centre to focus
on developing new-age
storage drives
SINGAPORE: Seagate Technology last Friday opened a S$100
million (RM280.33 million) design and research and development centre in Singapore that
will house 500 research scientists
and engineers. The Singapore
Seagate Design Centre will focus
on developing its next-generation of thin 2.5-inch (5.35cm)
storage drives, The Straits Times
reported. The new facility,
named “The Shugart” in honour of the founder of Seagate,
Al Shugart, consists of two nineand six-storey blocks and three
underground carpark levels.
26 WORLD
‘Pirates’ held by Vietnam
speak Indonesian — media
Carrying large amounts of cash when apprehended
HANOI: Eight men detained by Vietnam on suspicion of hijacking a Malaysian-flagged tanker speak Indonesian and were carrying large amounts
of cash when they were apprehended,
state media reported yesterday.
The group were taken into custody last Friday after they pulled up
to Vietnam’s southwestern Tho Chu
island in a lifeboat claiming to have
encountered an accident at sea.
The same day Malaysian authorities said eight men who had commandeered the MT Orkim Harmony
a week earlier had managed to give
China, US set for
‘vigorous’ talks
on tough issues
warships the slip by escaping in a lifeboat under cover of darkness.
The vessel was the latest to be
targeted by increasingly bold pirates behind an upsurge of sea hijackings in Southeast Asia in the
past two years that have typically
targeted smaller tankers carrying
valuable petrol, diesel or gas oil.
VNExpress yesterday said the
eight men — aged from 19 to 61 —
spoke in Indonesian and “could not
explain the origin of a big volume
of foreign currency they were carrying and dozens of phones”.
“These suspects were very stubborn, refusing to cooperate. They were
professional and were very calm,”
Lieutenant Do Van Toan of Vietnam’s
marine police was quoted as saying.
Another marine police official,
Colonel Le Van Minh, said investigators “have enough grounds to
charge these eight suspects.”
“Vietnam is actively cooperating with Malaysia in the case. The
point is how to make them admit
their crimes,” he added.
Indonesia’s state news agency
said Jakarta had ordered its Hanoi
embassy to find out the nationality
of the men.
MT Orkim Harmony, carrying around 6,000 tonnes of petrol
worth an estimated US$5.6 million
(RM20.94 billion), went missing on
June 11 en route from Malaysia’s
western coast to the port of Kuantan on the east coast.
The vessel’s 22 crew members
were unscathed except for a slightly injured Indonesian seaman who
was being treated for a gunshot
wound to the thigh, the Malaysian
navy said last Friday. — AFP
Racist ‘manifesto’ lays bare
Charleston motive
People listening to
gospel music outside
Emanuel African
Methodist Episcopal
Church in Charleston
yesterday. The
church, one of
the most historic
African-American
places of worship,
reopened three days
after the shooting.
Photo by Reuters
BY ROBERT M AC P HE RS O N
COLUMBIA: A chilling website apparently created by Dylann Roof
emerged on Saturday in which the
accused Charleston church shooter
rails against African Americans and
appears in photographs with guns
and burning the US flag.
It came to light as a mournful vigil
last Friday for the nine black worshippers killed at Emanuel African Methodist Episcopal Church gave way to
anger and protests in Charleston and
the state capital Columbia.
The church, one of the most historic African-American places of
worship, meanwhile reopened three
days after the bloodbath.
A rambling 2,500-word manifesto on the website, laced with racist
lingo and spelling errors, does not
bear the 21-year-old suspected white
supremacist’s name.
But its first-person style, its title —
“Last Rhodesian” — and references
to Charleston and apartheid South
Africa suggested he was its author.
There were also photos of Roof on
the site.
Roof, who went on the run after last Wednesday’s shooting, was
caught a day later in neighboring
North Carolina and is in solitary confinement in jail charged with nine
counts of murder.
The FBI said it was “taking steps to
verify the authenticity” of the website.
Somber mourning turned to anger
on Saturday, with a rally at the state
legislature in Columbia, where the
Confederate flag has been a focal
point for controversy for years.
Unlike US and state flags, it was
not lowered to half-staff after the killings — because, officials say, doing so
by South Carolina (SC) law requires
approval from the state legislature.
While some whites consider the
Civil War-era flag an emblem of
Southern regional pride and heritage, others — black and white —
see it as a sinister symbol of white
supremacy and racism.
Several hundred chanting demonstrators massed outside the state
house, the Confederate flag flapping
in the evening breeze.
Former Republican White House
hopeful Mitt Romney posted on Twitter: “it’s time to take down flag in SC.”
In response, Obama tweeted:
“Good point, Mitt,” with a link to
Romney’s comment.
Roof’s alleged online manifesto
painted a chilling portrait of an angry young man.
“I have no choice. I am not in the
position to, alone, go into the ghetto
and fight,” the purported manifesto
stated.
“I chose Charleston because it is
[the] most historic city in my state,
and at one time had the highest ratio
of blacks to whites in the country.
“We have no skinheads, no real
KKK (Ku Klux Klan), no one doing
anything but talking on the Internet.
Well someone has to have the bravery to take it to the real world, and
I guess that has to be me.” — AFP
South Korea says three new Mers cases
SEOUL/BANGKOK: South Korea
reported three new cases of Middle
East Respiratory Syndrome (Mers)
yesterday, bringing the total to 169
in the largest outbreak outside Saudi Arabia, but Thailand said it had
no new infections.
South Korea’s Health Ministry
late on Saturday reported the 25th
fatality, a patient who had suffered
a heart ailment and diabetes. The
outbreak was first confirmed on
May 20 but seems to have levelled
off, the ministry said last Friday.
Thailand, which discovered its first
case last week, says 175 people were
exposed to its single patient, with no
new infections reported so far.
Hundreds of thousands
rally in Rome against
gay unions
ROME: Hundreds of thousands
of Italians gathered in Rome on
Saturday to demonstrate against
gay unions and the teaching of
gender theories in schools, as
Prime Minister Matteo Renzi
tries to push a civil union bill
through parliament. Holding
aloft banners reading “The family will save the world” and “Let’s
defend our children”, a sea of
people crammed into the San
Giovanni square near the Italian
capital’s historic centre to support family values. The square,
which can hold an estimated
300,000 people, was overflowing with the young, elderly and
parents with toddlers, an AFP
photographer said, with many
more demonstrators spilling
into nearby streets. Organisers
for their part said one million
people were taking part. Italian
police never provide figures for
demos. — AFP
Palestinian stabs Israeli
policeman, then shot by
same officer
BY JO B I D DL E
WASHINGTON: The United
States is vowing not to “paper
over” differences with China
at key talks this week weighed
down by thorny issues of trade,
cyberspying and tensions in the
South China Sea.
And while some analysts believe there will be few concrete
results from the annual USChina Strategic and Economic Dialogue, the two-day talks
which open formally tomorrow
in Washington are seen as an important forum for managing ties
between the two global powers.
“We talk through, we work
through our differences. We seek
to solve problems and to manage
the problems that we can’t seem
to solve,” said the top US diplomat for East Asia, Danny Russel.
“We don’t paper over these
differences. We don’t turn a
blind eye to problems. We discuss them and we seek to tackle
them directly.”
US Secretary of State John
Kerry and Treasury Secretary
Jack Lew will host China’s State
Councillor Yang Jiechi and VicePremier Wang Yang for a private
dinner today, before the talks
kick off at the State Department
tomorrow.
The world’s two leading economies remain at odds over China’s claims to much of the South
China Sea
Ties have also strained over
US accusations of cyberespionage.
But both countries recognise
it is an area where they need to
cooperate.
The state-run Chinese press
appeared optimistic about this
seventh round of annual talks,
which come ahead of a visit to
the US by Chinese President Xi
Jinping in September. — AFP
IN BRIEF
“We can confirm that there are
no new Mers patients,” said Health
Minister Rajata Rajatanavin as he
led reporters on a tour of Bangkok’s Suvarnabhumi airport to show
health and safety measures that
have been put in place, including thermoscans for passengers.
— Reuters
JERUSALEM: A Palestinian
stabbed an Israeli border policeman outside Jerusalem’s Old
City yesterday, critically wounding him, with the officer managing to shoot his attacker, leaving
him in critical condition. Police
described the incident, which
took place just outside Damascus Gate, as a “suspected terror attack,” saying the attacker
was an 18-year-old Palestinian
from the West Bank. “An 18-yearold resident of the West Bank
stabbed a border police officer
in the neck with a knife, and the
border police officer was taken
in critical condition to Shaarei
Tzedek hospital in Ein Kerem,”
police spokesman Luba Samri
said in a statement. — AFP
New Orleans policeman
shot and killed while
transporting suspect
NEW ORLEANS: A suspect shot
and killed a 22-year New Orleans
police veteran who was transporting him to jail on Saturday,
officials said, adding that a manhunt was underway for the suspect who escaped the police vehicle, which crashed into a utility
pole. It remained unclear how
exactly officer Daryle Holloway,
45, was killed, but police said
they were seeking Travis Boys,
33, the suspect who had been
handcuffed when Holloway began driving. — Reuters
Philippines takes precautions as volcano emits ash
MANILA: The Philippines has
stockpiled food supplies in case of
evacuations after a volcano emitted ash and smoke six times in
recent weeks, officials said yesterday. In addition to the emergency
food packs, authorities are closely watching communities near
Bulusan volcano 390km southeast of Manila, said presidential
spokesman Herminio Coloma.
The latest emissions came last
Friday, with two other eruptions
earlier last week. — AFP
S P O RT S 2 7
On course for first Open title after dope ban
KUALA LUMPUR: Unseeded Datuk Lee Chong Wei gears up for a
final battle against third-seeded
Hans-Kristian Vittinghus of Denmark in the US Open Grand Prix
Gold held at the Suffolk County
Community College, Brentwood,
United States.
Undaunted Day
guts out 68 after
vertigo attack
last Friday
BY GREG HEA K ES
TACOMA: Jason Day gutted out
a two-under 68 on Saturday to
seize a share of the US Open
lead, just a day after collapsing on the ninth hole due to
an attack of vertigo.
Day, a two-time US Open
runner-up in 2011 and 2013,
went four-under through his
final seven holes on Saturday,
as he battled dizzy spells, nausea and the shakes in Saturday’s
third round at the Chambers
Bay golf course.
“The vertigo came back a little bit on the 13th tee box, and
then I felt nauseous all day,”
Day said. “I started shaking on
the 16th tee box and then just
tried to get it in, really. [I] just
wanted to get it in.”
The 27-year-old Queenslander started the day at the
Chambers Bay golf course just
three shots adrift of the overnight leaders in a tie for ninth
place and finished it in a fourway deadlock with co-leaders Dustin Johnson, Branden
Grace and Jordan Spieth at
four-under 206.
Day said he was bothered all
round long, first by the drugs
the doctors gave him to treat
the vertigo and later by nausea from another attack, but
it wasn’t enough to stop his
assault on the leader board.
“I felt pretty groggy on the
front nine just from the drugs
that I had in my system, then
kind of flushed that out on the
back nine. But then it kind of
came back,” he said of the vertigo.
His third round began with
a perfect 350-yard drive down
the middle of the first fairway
and he capped it with back-toback birdies on 17 and 18. He
finished with five birdies, three
bogeys and 10 pars.
Day’s caddie Colin Swatton
said he was in awe of the lionhearted Aussie’s performance.
Last Friday, the 2011 Masters runner-up hit his tee shot
at the par-three ninth into a
bunker and then fell to the
ground as he made his way
down the slope to the lower
green. A medical team took
several minutes to revive him
before he staggered on, playing
his bunker shot and two-putting for a bogey four. — AFP
The US Open GP Gold is Chong
Wei’s first open tournament and
third international assignment
since serving out an eight-month
ban for a doping violation.
In the semi-finals match in New
York, the former world No 1 took
32 minutes to dispose of England’s
Rajiv Ouseph 21-9 and 21-14 to
book his first open tournament’s
final after the eight-month ban.
For the record, the 33-year-old
won all three matches against the
Danish and their last meet was in
the 2014 Indonesia Open.
In another semi-finals match,
Vittinghus was stretched to the
limit before prevailing in the US
Open final.
The world No 18 had to dig deep
into his reserves to beat top seeded
Chou Tien Chen of Taiwan 12-21,
21-11 and 21-13 in a 51-minute
semi-final round. — Bernama
How a billionaire
heiress cracked the
EPL’s boys club
Liebherr, owner of Southampton, leads team to best season
BY DANIELLE RO S S I NG H
& DAV ID DE JO NG
LONDON: The English Premier
League (EPL), a playground for
male billionaires, lures owners from
around the globe. Russian Roman
Abramovich controls Chelsea, which
in May clinched its fourth EPL title in
10 years. Sheikh Mansour bin Zayed
Al Nahyan, deputy prime minister
of the United Arab Emirates, owns
No 2 Manchester City. Americans
control five of the league’s 20 teams,
including fabled Manchester United
and its hated rival, Liverpool.
These men clash in the world’s
richest soccer league. Abramovich’s
Chelsea broke the British record in
2011, paying £50 million (RM296.91
million) to lure striker Fernando
Torres from Liverpool, controlled by
Boston Red Sox owner John Henry.
Club nicknames — Gunners, Hammers, Spurs — proclaim testosterone-infused ambitions.
Into this all-boys club has
stepped a female interloper: a
low-key Swiss-German heiress
named Katharina Liebherr. Her
team, Southampton, known as the
Saints, play in the namesake seaside town.
Liebherr, 37, brings to the onetime church club what her chief excutive officer, Gareth Rogers, calls
“real warmth” and “an acute sense
of empathy” — attributes rarely
voiced, at least as compliments,
in British football.
Liebherr waving to Southampton fans
during a recent match. Photo by AFP
But Liebherr is proving herself.
She inherited Southampton from
her father, Markus Liebherr, after
he died suddenly in August 2010.
She took charge when Chairman
Nicola Cortese departed after a
January 2014 power struggle.
The tabloids blamed her. “Liebherr the Dream Wrecker!” scolded the Daily Mail. “EXCLUSIVE.
REVEALED,’’ trumpeted The Sun.
“Woman at centre of Southampton nightmare.” Liebherr endured
more wrath when Coach Mauricio
Pochettino defected to Tottenham
Hotspur and 10 players transferred
last year. By the end of that summer, the Saints were a 6-1 bet at
UK bookmakers to be booted to a
lower division, a fate they last suffered in 2005. The bookies were
wrong. Liebherr has presided over
the team’s most successful Premier
League season ever. Southampton
finished seventh with a club-high 60
points. It returned a profit of £33.4
million in fiscal 2014, the first since
it almost went bankrupt in 2009.
And the Saints — with annual
revenue of £106 million in the 2013–
2014 season, a quarter of Manchester United’s £433 million — qualified for Europe-wide competition
for the first time in 12 seasons. “I’m
not going to lie and say it wasn’t
a difficult summer,” CEO Rogers
says. “While the entire world was
predicting a meltdown, internally
that wasn’t the case.”
Through the ups and downs,
Liebherr worked behind the scenes.
(She declined to speak for this story.) When Cortese left, she named
herself non-executive chairman
and promised fans “stability and
calm”. By March 2014, she created
a new board. She loaned the team
£20 million to clear a debt, added
14 players, and hired Dutch soccer
legend Ronald Koeman as coach.
Liebherr was never a football
nut. She inherited about US$1 billion (RM3.74 billion). The team,
now valued by the Bloomberg Billionaires Index at about US$260
million, was a bonus. — Bloomberg
IN BRIEF
Front row start for Khairul
Idham at Barcelona
KUALA LUMPUR: National rider, Khairul Idham Pawi of Honda Team Asia is set to battle for
another podium in the Moto3
Junior World Championship
after qualifying for a front row
at the Catalunya Circuit, Barcelona on Saturday. According to
Honda Team Asia, the 16-yearold rider was third quickest on
the Moto3 combined time sheet
with 1 minute 51.481 second, recorded during the first qualifying
session. “I’m very happy because
in QP1 (Qualifying Practice 1) we
got quite close to the best lap. Initially we targeted to step up the
pace in QP2 but unfortunately I
got caught in traffic and missed
pole by half a second. “Nevertheless, we displayed a competitive
pace and hopefully we can ride
better in the race,” said Khairul
in a statement issued here yesterday. — Bernama
Local triumph as Prayad
takes Queen’s Cup
BANGKOK: Thailand’s Prayad
Marksaeng swept to victory on
home soil at the Queen’s Cup in
Koh Samui yesterday shooting
a six-under par 65 on a day that
proved to be a nightmare for Japan’s Akinori Tani. Prayad’s fortunes waxed and waned during
round four of the US$300,000
(RM1.12 million) Asian Tour
title as the 49-year-old made
up for three bogeys with nine
impressive birdies, comfortably
taking the top spot with a final
score of 270. Fellow Thai Thanyakon Khrongpha matched
Prayad’s 75 to jump up the leaderboard to second on 272,
closely followed by compatriot Jazz Janewattananond and
Bangladesh’s Siddikur Rahman
who ended four strokes off the
lead in joint third. — AFP
13 backup riders named for
cycling championship
KUALA TERENGGANU: The
Terengganu Cycling Association
has named 13 backup riders
for the Indonesian Club Cycling Championship in West
Java in August. Head coach Syed
Mohd Hussaini Syed Mazlan
said they will send eight men
and five women riders to gain
exposure as part of their preparation for the 2016 Sukma in Sarawak. “The Kuningan-Cirebon
Championships is the second
challenge for our Sukma riders.
The first was for the CilacapYogyakarta Championships last
month where they did well,” he
told Bernama here, yesterday.
— Bernama
Call for volunteers for 2017 SEA Games soon
Japan soccer boss denies
payment to Conmebol
KUALA LUMPUR: Aspiring volunteers who wish to offer their services
for the 2017 Southeast Asia (SEA)
Games would be able to submit their
applications soon, said Youth and
Sports Minister Khairy Jamaluddin.
Khairy said the date for applications to become volunteers for
the 2017 SEA Games that Malaysia
will host, will be announced soon.
“Volunteers will soon be able to
TOKYO: A senior official of
the Japan Football Association (JFA) has denied allegations that it paid US$1.5 million
(RM5.61 million) to the sport’s
South American confederation
for supporting its co-hosting of
the 2002 World Cup, a newspaper reported yesterday. “It’s
impossible,” JFA honorary president Junji Ogura told Asahi
Shimbun. — AFP
apply for a place in Team Malaysia.
Let’s make the 2017 SEA Games the
best one ever,” he said in his Facebook posting yesterday.
Khairy who is also the 2017 SEA
Games Organising Committee chairman said preparations will take off
to ensure Malaysia emerge as the
overall champion in 2017.
The host job for the 2017 SEA
Games was initially awarded to Bru-
nei but since the country requested
more time, Malaysia took over the
host job with the approval of the
Cabinet.
Malaysia will be hosting the SEA
Games for the sixth time.
The last time Malaysia hosted
the SEA Games was in 2001 and
emerged as the overall champion with 111 gold, 98 silver and 86
bronze medals. — Bernama
28
live it!
MO
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Personal
ASSISTANT
COMPI L ED BY S HALINI YEAP
WORK. LIFE. BALANCE
TANTALISE your taste buds with the
Citarasa Timur ke Barat promotion at the
Cinnamon Coffee House, One World Hotel.
The coffee house will be transformed into
a bazaar with live action stalls serving up
delicious dishes from the various states
in Malaysia. Expect to be spoilt for choice
with over 100 dishes that is part of hearty
Malay cuisine like Bubur Lambuk, Daging
Dendeng and Pulut Serawa Durian as
well as Chinese, Indian, Japanese and
Western fare. It is priced at RM158 for
adults and RM79 for children (aged four
to 12). One World Hotel is located at First
Avenue, Bandar Utama, PJ. Call (03) 7681
1157 for reservations or log on to www.
oneworldhotel.com.my for more details.
BE amazed by the artworks that’s part
of Winter Garden: The Exploration of
Micropop Imagination in Contemporary
Japanese Art. Curated by Midori Matsui,
the exhibition features a unique and
complex micropop approach that
combines fragments of information to
devise a new perspective of the everyday
or mundane. View the exhibition at the
University of Malaya Art Gallery, level
5, Chancellery Building, University of
Malaya, Kuala Lumpur. Gallery hours are
9am to 5pm, admission is free. Further
information can be obtained from www.
museum.um.edu.my or by contacting
(03) 7967 3936.
KICK start your
week with the
rock musical
Tick, Tick…
Boom! Set in
the Big Apple, it
follows the story
of Jonathan,
who grasps with
the changes he
is facing as he
is about to turn 30, all while attempting to
put together a new musical that he believes
will sweep Broadway off its feet. Written
by Jonathan Larson, who was behind the
hit musical Rent, Tick, Tick… Boom! will
be performed at the Theatre Lounge Café,
B1-3A, Plaza Damas 3, Desa Sri Hartamas,
Kuala Lumpur. Tickets are priced at RM65
for the standard seat and RM117 for the
sofa seat. Call (03) 6730 7982 or visit www.
theatreloungecafe.com for ticketing details.
Labour of
LOVE
A hybrid exhibition that probes estate of the late Ismail Hashim
BY ANANDHI G O P I NATH
T
his is your last week to catch
UNPACK-REPACK: Archiving & Staging Ismail Hashim
(1940-2013), a hybrid exhibition that probes the intersections of a posthumous career retrospective and that of an ongoing
archiving and unpacking of the estate of
the late Ismail Hashim.
This special showcase was curated by
Wong Hoy Cheong, who worked together with archivist Nur Hanim Khairuddin
and producers Iqbal Shamsul and Jaafar
Ismail, from Fergana Art. It aims to present Ismail Hashim as a photographer
and chronicler, a humanist and social
observer of people and the environment.
Ismail remained under the radar through
much of his life, and in that time he crafted
a complex and paradoxical world built with
romance and ruthless scrutiny, framed by
the indomitable passing of time, suffused
with immense beauty and a hope for renewal but ruptured by the pathos of human
inefficacy, frailty and mortality.
Yet, he had an enduring faith in human
courage and resilience, never losing his
sense of irony and wit. He was everyman’s
photographer, who was able to call upon
our collective memories to see and reconsider the familiar with new eyes. Ismail
died tragically in a motorcycle accident
at the age of 73, and today is the second
anniversary of his passing.
Six months after his death, Wong,
Hanim, Iqbal and Jaafar ventured into his
studio in Nibong Tebal, Penang, to begin
the archiving process. Before he died,
Ismail had been in talks to put together
an exhibition of his work — so what was
initially meant to be a living retrospective turned into a posthumous tribute.
Using the vast archives of approximately 20,000 photographs, negatives, slides,
documents, books and objects as a starting point, this project sought to unravel
the thoughts and preoccupations of the
artist. It examines his works and archives
from various trajectories, eliciting multiple
narratives and readings, and it also lays
bare the complexities of documentation
and the staging of an artist’s archive.
The resulting documentation, analysis,
and archival displays form the core of what
will be a publicly accessible archive and research hub related to both the artist and the
photographic medium, a first for Malaysia.
In doing so, the research-driven exhibition
hopes to unravel, reveal and gain an understanding of a lifetime of work by this
witty, intensely creative and talented man.
UNPACK-REPACK debuted at Penang’s
Whiteaways Arcade last year as part of
the George Town Festival, and opened at
Balai Seni Lukis in KL in February. With
more space to play with, the exhibition
is much expanded and is a most worthy
tribute to Ismail’s creative spirit and passions outside of his work.
Divided into six different sections, the
showcase is a unified approach to presenting the breadth of the archiving process.
Looking Out expresses Ismail’s constant
desire to travel, his passion to roam with a
hungry heart. This section includes images
of Ismail photographing while riding on his
motorcycle, which establishes his physical
and spatial relationship to the surroundings.
It examines Ismail’s view of the external
world, absorbing and capturing the vastness
of the land and her people, scrutinising the
social and material environment.
Looking In, conversely, is a space for
pause and reflection. Ismail goes from
commentator of the external world to the
world inside, and the images here range
from house and home, to family and pets,
to the in-between space of garden and
compound which buffer the home from
the world beyond. The viewer inadvertently becomes a voyeur into this world.
The next section offers a deeper understanding of Ismail’s life with a biographical
map of the artist as a creative and social
being. As The World Turns consists of
photographs, drawings, paintings and
graphic works exhibited alongside vitrines displaying personal notes, documents, books and newspaper clippings
drawn from the artist’s archive as well as
pu
bir
out
by
“al
tio
wh
and
arc
and
hib
Ma
“ya
attr
and
art
gy,
am
mo
anc
tio
las
ph
bo
and
con
rea
and
UN
(19
Neg
ho
See
live it! 29
M O N DAY J U N E 22, 20 15 • T HEED G E FINA NCIA L DA ILY
SCENE
BY M I C HAE L RO D DY
Ai Weiwei to show in London
The exhibition
includes a great
many of Ismail's
personal effects,
including a
detailed recreation
of his studio —
elements that
make it
a personal and
intimate look at not
just his oeuvre of
work, but his
soul as well.
thy
as-
the
nts.
ant
ha
ges
his
cal
ngs.
nal
ess
the
for
om
the
nge
ets,
nd
om
ertrld.
dercal
cial
of
nd
vitcungs
l as
public records. It begins, hauntingly, with the artist’s
birth certificate and ends with the last photographic
outing on the day the artist died.
Going Bananas is a title and idea used repeatedly
by the artist for many of his works on the subject of
“all things bananas”, and is an apt way to title a section on Ismail’s physical environment. This section,
which includes stunning recreations of Ismail’s studio
and darkroom, includes his photographic tools and
archives and documentations of his methodologies
and processes.
Yang ‘Tu Yang ‘Ni, the title of Ismail’s 2008 solo exhibition, is a colloquial and casual phrase in Bahasa
Malaysia that means “this and that”. The single word
“yang” also connects parts of sentences and to introduce
attributes, physical and metaphysical, transcending time
and location. While the previous section presented the
artist’s works in terms of subject matter and chronology, this space explores the “this and that” of existence:
among them, memory and absence, ephemarality and
mortality, rationality and spirituality, humour and melancholia, truth and beauty.
The classification, documentation and restoration of Ismail’s archives have been ongoing since
last year. Thus far, about 14,000 items — including
photographs, negatives, slides, notes, documents,
books and objects — have been classified, digitised
and documented. The final section, Living Archives,
consists of over 2,000 items of the archive that are
ready to be accessed and made public for viewing
and online research.
UNPACK-REPACK: Archiving & Staging Ismail Hashim
(1940-2013) runs until June 30 at Balai Seni Lukis
Negara, Jalan Bachang, off Jalan Ipoh, KL. Opening
hours are from 10am to 6pm daily. Admission is free.
See www.artgallery.gov.my for more details.
THE Chinese dissident artist Ai Weiwei
will have what is being billed as the biggest retrospective of his work ever staged
in Britain at an exhibition opening at the
Royal Academy of Art in September, the
academy said last week. The show is being
mounted in Ai’s absence, since he cannot
travel outside China. For decades a critic
of the Chinese government’s record on
free speech and human rights, Ai has been
banned from travel since his 81-day detention in China in 2011.
The exhibition will include works from
1993 onwards, marking the years since Ai
returned to China after more than a decade working abroad, including in New York
where he was heavily influenced by pop
artist Andy Warhol and also became a proponent of the “found art” movement epitomised by Marcel Duchamp.
“I’m honoured to have the chance to exhibit at the Royal Academy of Arts,” Ai said
in a statement released by the Academy.
“This exhibition is my first major survey in
London, a city I greatly admire. The selected artworks reflect my practice in recent
years, and also include new works made
specifically for this show.”
The exhibition has been developed in
close collaboration with Ai, the Academy
said. “The artist has virtually navigated the
spaces from his studio in Beijing, through
video footage of the galleries and architectural plans. The curators have also made
regular visits to his studio.”
Many of Ai’s works use ancient artefacts,
such as Qing dynasty vases, and rework them
with modern enamels and similar touches.
He also draws attention to the lack of privacy in modern life with carefully crafted
marble replicas of security or video cameras.
A new artwork Remains (2015), that will
be in the exhibition is a work in porcelain that
replicates a group of bones that were recently
excavated at a site of a labour camp that operated under Communist leader Mao Zedong
in the 1950s. Another of the key installations
will be Straight (2008-2012), part of a body
of work related to the Sichuan earthquake
of 2008. It is fabricated from 90 tons of bent
and twisted rebar collected by the artist and
straightened by hand as a monument to the
victims of the earthquake.
The exhibition further marks Ai having
been elected an Honorary Member of the
Royal Academy of Arts in May 2011, as an
act of solidarity following his detention.
“This exhibition will follow in the Royal
Academy’s tradition of celebrating its Royal Academicians, continuing the strand of
programing that has showcased some of
the most significant living artists including
Anish Kapoor, David Hockney and Anselm
Kiefer,” the Academy said. — Reuters
PICK OF THE DAY
THE classic fragrance Colonia by Acqua Di Parma
is now available in a handy travel version that
comes in a sleek leather case. Carry the unique
notes of this masculine and sensuous perfume
at all times, which also includes heart notes of
lavender, Bulgaria rose, verbena and rosemary
as well as a blend of precious woods like vetiver, sandalwood and patchouli. The Colonia EDT
travel spray together with its leather case retails
at RM493 (30ml) and is available for purchase
at Parkson in Pavilion Kuala Lumpur.
30
live it!
Zen TODAY
To laugh is to live profoundly. — Milan Kundera
Tracey Emin, the bad girl of
BRITISH ART
B
ritish artist Tracey Emin
seems stressed and ruffled as
she weaves through crowds of
deep-pocketed collectors to
reach three of her pieces on
prominent display at Art Basel.
“It’s a trade fair, isn’t it? People are shopping,”
she told AFP in an interview at the largest
contemporary art fair on the planet, which
opened to the public last Thursday.
Emin, one of Britain’s most famous living
artists, said showing her work at the Lehmann Maupin gallery booth at Basel, inside
halls teeming with art enthusiasts and investors, was very different to exhibiting in
dedicated museums and galleries.
“It’s heightened commerciality on an
extreme level. You’ve got billionaires and
millionaires and art lovers that are getting
in from all over the world, and they have
come here to buy art,” she said.
A vast array of artworks by 20th century
masters like Picasso, Calder and Warhol,
mixed in with today’s cutting-edge creations are on display across 284 galleries
at the fair. The 51-year-old artist, who entered the art scene more than two decades
ago as part of the wild Young British Artists
movement, says she thinks investing in art
is a good thing . “Much better than buying
other things, like gold bars.”
But investment in art just to turn a buck
is something she has no patience with. “I
don’t like flippers. I don’t like people who
buy the work and then flip it. I’ve no respect
for them whatsoever,” she said.
Emin, known for her raw openness and
often sexually provocative works, said attending Art Basel, where she is set to be
honoured on Saturday, “is absolutely exhausting”, forcing her to face crowds of fans
A view of Emin’s bronze The Heart Has Its Reasons, which sold for around £120,000 at Art Basel.
and hop from reception to party.
But fairs have a clear advantage too, she
said. “It’s really brilliant at fairs because you
can stand behind people and hear what they
are saying,” she said, nodding towards a couple studying an embroidery of her crotch.
“I’m instantly recognisable, and it’s really
great when they turn around and they see
me,” she said with a wry smile. “If they say
something nice, then it’s good, but if it’s
negative, then it’s a lot of fun for me, I can
assure you. I am very confident and strong
about my work, so it doesn’t really get to me,
but it’s good fun.”
Lehmann Maupin has already sold three
Emin pieces at Art Basel, including a large
bronze sculpture of a couple kissing pas-
sionately, called The Heart Has Its Reasons,
for around £120,000 (RM712,606). Her most
famous work is perhaps My Bed, a 1998 installation consisting of a rumpled bed surrounded by the intimate debris of empty bottles of
vodka, cigarette packets and condoms, which
sold at auction last year for US$3.8 million.
That piece is currently showing at Tate Britain, alongside six of her recent figure drawings and two oil paintings by Francis Bacon.
Emin also has around 50 of her often
highly sexualised works on display at Vienna’s Leopold Museum, alongside 15 similar, if tamer, drawings and poems by Egon
Schiele, one of her great inspirations. She
said she was also planning a show alongside
another one of her influences, Norwegian
master Edvard Munch, in 2019, and “there’s
a possibility of Rodin.”
“It’s all going into place,” she said.
Emin admits that her previous “bad girl”
image has shifted over the years as she has
become a staple of the art world establishment. “Things have to change. I can’t carry
on as I was when I was 28. It’s impossible,”
she said. “I’m buying full-piece swimsuits
now. I bought myself a leaf collector the
other day, so I’m slowly catching up with
my age,” she said.
Regardless of her age or where she is in
the world, Emin said she always brought
her water colours and sketch books with
her. “Wherever I am, I’m always working,”
she said. — AFP

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