小资女向前冲（大马股市）

Business

- Distributing and manufacturing wood product

- Owned 13 subsidiaries 

- supplying plywood and other wood-based products to the local building industry and furniture manufacturers

Geography segment

- Malaysia (82%)

- Australia

- Asia (Vietnam,Singapore, Thailand)

- South Africa 

- Philippines

Financial performance

- Revenue increased 6% (QoQ); 22% (YoY)

- Gross profit margin 7.2% - low profit margin

- Profit before tax margin 5.76%

- Net profit margin 4.9%

- Short term Bank borrowing:RM 154.571mn

- Long term bank borrowing: RM8.929mn

- Cash and bank equivalents: RM5.719mn

- Manufacturing of wood products contribute 20.13% to revenue

- Distributing of wood products contribute 79.22%

Manufacturing sector

- A better result from manufacturing division on both revenue and operating profit.

- It was due to market share expansion and enjoy a better margin achieved through concentrating on high margin products and cost management

Distribution division

 - Increased of revenue was due to additional market share captured and penetration into new market

- Dominan benefit from strong USD exchange, Current quarter gain on foreign exchange was RM1.242mn

Annual report 2016

- Weaken RM will burden Dominan,as cost of imported raw material increase

- Borrowing mainly denominated in RM 

Factors that will affect company performance

- Raw material

- Foreign currency exchange (Weaken RM increased imported cost, Strengthen USD increase profit)

- Wood panel product price

- Weal demand from local Construction business

News

- Malaysian Timber Industry Board targets for exports of the furniture products to be worth RM16.0 billion by 2020, from RM9.1 billion in 2015 ( Annual Report 2016)

Lumber future price

Comment

- Most of the revenue is come from Malaysia, according to annual report 2016: 82%

- Strengthen of USD dollar would benefit to Dominan but in small portion. It will offset by high imported cost of raw material.

- Would Doninan benefie from local construction project?

How fast market react to better result!!

However, personally think upside trend is limited

Share price

- Assume next quarter EPS is 4.5, sum up 4 quarter is RM0.1381

- Given PE:10

- Share price is RM1.38

- Current share price: RM1.22

- Resistance level: RM1.25

- Support level: RM1.17/RM1.18, Loss 4%

Reference:

https://www.investing.com/commodities/lumber

http://bblifediary.blogspot.my/2015/03/dominan.html   (article about dominan)

http://klsecompany.blogspot.my/2015/06/7evergrnmiecoheveadominan.html  (article about dominan)