UMW Holdings Berhad

Business Description:
UMW Holdings Berhad (UMW) is a Malaysia-based company. UMW operates in four segments:

1. automotive; 
2. equipment, which supplies marine engine, material handling and compressed air equipment; 
3. manufacturing and engineering, which provides engineering solutions to automotive components, transportation, petrochemicals, oleochemicals, and oil and gas industries; 
4. oil and gas, and others. 

Its oil and gas segment includes five upstream activities: manufacture of oil country tubular goods and line pipes; oil and gas exploration operations; fabrication of oil and gas structures; provision of oilfield services, and supply of oilfield products. The operations of UMW are carried out in Malaysia, Australia, China, Hong Kong, India, Indonesia, Myanmar, Oman, Papua New Guinea, Singapore, Taiwan, Thailand, Turkmenistan and Vietnam. During the year ended December 31, 2009, UMW sold 248,521 units of Toyota and Perodua vehicles.

Current Price (7/1/2011): 7.61
2009 Sales 10,720,861,000
Employees: 10,000
Market Cap: 8,758,836,040
Shares Outstanding: 1,150,964,000
Closely Held Shares: 17,000

2004 DPS 7.2 EPS 16.5
2005 DPS 9.9 EPS 28.0
2006 DPS 13.7 EPS 30.0
2007 DPS 15.9 EPS 43.6
2008 DPS 30.3 EPS 51.8
2009 DPS 24.7 EPS 34.2
9M10 DPS 23.50 EPS 43.55 NTA 3.5939

Estimated EPS for 2010 = 43.55*4/3 = 58.07 sen
Projected PE for 2010 = 7.61 / 0.5807 = 13.1 x

Historical
5 Yr
PE range 10.4 – 15.4
DY range 5.1% – 3.5%

10 Yr
PE range 9.9 – 14.2
DY range 4.0% – 2.8%

Health is Wealth
Bullbear Stock Investing Notes

By Kamarul Yunus
Published: 2010/11/04

MALAYSIA aims to become an oil field services and equipment (OFSE) hub for Asia, leveraging on its strategic location at the centre of the Asia Pacific region and adjacent to the international shipping lanes.

Under the Economic Transformation Programme (ETP), three entry point projects (EPPs) have been identified to attain the target.

As outlined under the National Key Economic Activity (NKEA) for oil, gas and energy sector, the three EPPs are to attract multinational companies (MNCs) to bring a sizeable share of their global operations to Malaysia, the ETP report said.

The projects are also geared at consolidating domestic fabrications, developing engineering, procurement and installation capabilities and capacity through strategic partnerships and joint ventures.

The global OFSE market is valued at RM800 billion and has undergone rapid growth of 25 per cent an annum in recent years.

With a burgeoning domestic oil and gas industry, proximity to oil fields and a cost-competitive workforce, Malaysia is well-placed to become Asia’s OFSE hub.

In addition, by increasing competitive pressures in the domestic market, there is potential for Malaysian companies to first become domestic champions and subsequently regional champions as it captures a larger share of the regional market.

Under the sector’s NKEA, the target is to attract 10 to 20 major international companies in the OFSE industry, bringing about 10 per cent of their business operations to Malaysia.

“This translates to around 40 per cent of their regional activities and would mean positioning Malaysia as a cost-competitive base for engineering, procurement and construction as well as strategic base for installation activities in the Asia Pacific region,” the report noted.

If the goal is met, the OFSE industry will have considerable impact, creating over 20,000 jobs and almost RM6.1 billion of incremental gross national income (GNI) by 2020.

A permanent government body to be known as Oil Field Services Unit (OFSU) will be set up. It will be responsible for overseeing the oil field services industry’s growth and development.

Comprising 20 people, with at least 10 of whom will have the oil and gas industry experience, OFSU will be fully operational within the next six months.

Among others, its responsibilities are to make recommendations on how to restructure the domestic industry to create a more competitive environment and position the industry and its companies for growth, and to promote the Malaysian OFSE industry and companies to overseas firms and investors.

OFSU will require only minimal funding of RM5 million a year to cover its operating expenses. However, the success of the EPP is contingent on attracting foreign players to set up operations here, which would require estimated funding totalling RM6.8 billion. This comprises of RM6.3 billion in private investment and RM500 million in public investment.

On the whole, the ETP has identified 12 EPPs and two business opportunities within the NKEA for oil, gas and energy sector.

“These EPPs will contribute RM47.1 billion to GNI to meet the 2020 targets. An additional RM61.2 billion will come from business opportunities and baseline growth,” the report said.

Thus, the NKEA expects to deliver a RM131.4 billion GNI impact and create an additional 52,300 jobs in this sector.

A significant proportion of these jobs will be highly-skilled jobs, with an estimated 21,000 or 40 per cent for qualified professionals such as engineers and geologies, with monthly salaries in the range of RM5,000 to RM10,000.

The incremental GNI includes RM23.1 billion of GNI from the multiplier effect created by EPPs from other sectors.

The largest sources of the multiplier effect on the oil, gas and energy NKEA are palm oil, tourism and electronics and electrical NKEAs, for example, an increase in usage of energy due to an increase in tourists visiting Malaysia.

The oil, gas and energy NKEA is targeting a 5 per cent annual growth for the sector from 2010 to 2020. This is an ambitious goal, particularly against a backdrop of the natural 2 per cent decline of oil and gas production.

Read more: Malaysia wants to be Asia’s oil field services, equipment hub http://www.btimes.com.my/Current_News/BTIMES/articles/ogas/Article/index_html#ixzz14J1VBcRc

Comment: This news is positive for the oil and gas sector of Malaysia. It is also good for Coastal.

Health is Wealth

DPM: Malaysia can be come global deepwater oil, gas hub

MALAYSIA can become a key deep-water oil and gas (O&G) hub in the world, but this window of opportunity is not perpetual, says Deputy Prime Minister Tan Sri Muhyiddin Yassin.

The answer lies in its capacity and capability, he said, stressing that it is paramount for the country to leverage and build on existing O&G assets.

“If done right, Malaysia can become one of the world’s key deep-water O&G hubs after Houston, Rio de Janeiro and Aberdeen,” he said.

Muhyiddin was speaking to reporters after witnessing a memorandum of understanding signing ceremony between Asian Supply Base Sdn Bhd and Labuan Shipyard and Engineering Sdn Bhd in Labuan yesterday.

Technip Group president and chief executive officer Bernard Di Tullio at the 15th Asia Oil and Gas Conference last month said Malaysia was well on track to become the fourth deepwater oil and gas hub in the world.

Apart from Technip, Di Tullio said other key players in deepwater Malaysia include Malaysian Marine Heavy Engineering, Sapura and Aker Kvaerner.

“Sabah has shown a strong potential in the O&G business,” Muhyiddin said, adding that recent deep-water field discoveries there are now being developed and expected to begin production between 2011 and 2015.

“These sizeable ultra deepwater blocks offshore, coupled with the Kebabangan cluster gas fields, the completion of the Sabah Oil and Gas Terminal and the Sabah-Sarawak (Kimanis-Bintulu) gas pipeline project would position Labuan and Sabah as one of the leading O&G hubs in the region.

“Clearly the era of ‘easy oil’ is over and the exploration and production of O&G will move increasingly into deeper waters, presenting us new challenges as well as opportunities,” Muhyiddin said.

However, besides location, a regional hub demands one-stop centres with fully integratedport facilities, warehouses, workshops, ship maintainance and fabrication yards, Muhyiddin said, adding that this is where the partnership between Asian Supply Base and Labuan Shipyard is timely.

Read more: DPM: Malaysia can be come global deepwater oil, gas hub http://www.btimes.com.my/Current_News/BTIMES/articles/dpm22/Article/index_html#ixzz0uSS6JOqU




This news is positive for this company below.  Its CEO expressed optimism and has hinted on these developments in his annual report.

Health is Wealth

Industries in West Java, East Java and North Sumatra are suffering an acute shortage of gas due to the decline in demand from state gas distributor PT Perusahaan Gas Negara (PGN).

read more

The development of at least 16 oil and gas blocks owned by state oil and gas firm Pertamina has been delayed due to the company’s failure to obtain recommendation from the environmental office, a

read more

read more

State gas distributor PT Perusahaan Gas Negara (PGN) will acquire gas fields from existing operators and import Liquefied Natural Gas (LNG) to meet surging demand for gas, a senior official has sai

read more

The association of fuel station owners Hiswana Migas is asking lawmakers to remove the government’s permits to allow PT Petronas Niaga Indonesia and PT AKR Corporindo (AKR) to distribute subsidiz

read more

Skyrocketing 2008 oil prices caused a big increase in the investments needed for the Cepu, Senoro and Tangguh oil and gas projects, doubling initial costs, upstream oil and gas regulator BPMigas re

read more

Six oil and gas upstream projects and facilities, requiring a total investment of US$908.9 million, are expected to commence soon, the regulator BPMigas said.

read more