Tgoff’s 2QFY09 results were below expectations, mainly due to the higher number of engineering equipment contracts in 1QFY09, timing in the recognition of work completed whereby the bulk will only be recognised in 2H09, and losses incurred by its waste heat recovery units (WHRU) in 2QFY09 as a result of cost overrun and late delivery charges. As we expect the loss is only a one-off event, we are only downgrading our FY09 forecast by 20% in line with the poorer 2QFY09 results. Going forward, we see higher contribution from its vessel division in view of its enlarged fleet of 16 vessels by 1H10. Maintain Buy.
Maintain Buy but downgrading FY09 forecasts by 20%. We are only downgrading our FY09 forecast while keeping our FY10 forecast unchanged as we expect the loss to be a one-off event since management has taken precautions as stated in its Bursa announcement. Hence, our target price remains unchanged at RM1.74 based on a PER of 9x FY10 earnings. Going forward, we see contribution from its vessel division increasing from the present 20% to 30%-35% by 2010.
Maintain Buy but downgrading FY09 forecasts by 20%. We are only downgrading our FY09 forecast while keeping our FY10 forecast unchanged as we expect the loss to be a one-off event since management has taken precautions as stated in its Bursa announcement. Hence, our target price remains unchanged at RM1.74 based on a PER of 9x FY10 earnings. Going forward, we see contribution from its vessel division increasing from the present 20% to 30%-35% by 2010.