Aug 2007 Financial News

AMBL Releases Half Year Results

Aug 09, 2007

Results for the Half Year Ended June 30, 2007

Ansa Merchant Bank Limited (AMBL) for the Half Year Ended June 30, 2007, reported Earnings Per Share (EPS) of 89 cents which represented a significant increase of 56.14 per cent or 32 cents when compared to HY06.

For HY07, Total Income increased 27.56 per cent or $62.74 million to $290.40 million while Total Expenses rose 15.54 per cent or $26.82 million to $199.38 million. As such, Operating Profit for the period amounted to $91.02 million, up a considerable 65.18 per cent or $35.92 million on the same period in FY06.

The Effective Tax Rate for the period under review was 18 per cent compared to a Tax Rate of 12.39 per cent in HY06. Thus, Profit After Taxation, ended the period at $74.64 million, up 54.60 per cent or $26.36 million on the corresponding period in the previous financial year. According to the Chairman, this growth in Profit was complemented by the continued strong contribution from the General Insurance Business. In addition, the Bank’s business lines continued to emulate excellent risk management principles and accordingly the Bank’s financial results were progressive.

The Board of Directors has declared an Interim Dividend of 15 cents per share (10 cents - HY06), payable on October 5, 2007. This is indicative of the Directors’ confidence in the outlook for the second half of the year

AMBL last closed at a price of $22.00. In light of these results, we are maintaining our forecasted EPS for FY07 of $2.15, which at the current price translates to a P/E multiple of 10.23 times. Additionally using a multiple of 12 times and the forecasted EPS of $2.15, this share has an expected return of approximately 17 per cent on the current price or a target price of $25.80. Thus, based on this analysis we continue to recommend a BUY on this share. However, we continue to caution investors that the shares of AMBL are very tightly held. ANSA McAL Limited holds approximately 82 per cent of the share capital of this Company and hence there is limited availability and liquidity of these shares on the market.


Nancy Chen
WISE Equity Research Team