‘Surprise’ dividend in store for MISC shareholders

MISC Bhd, an energy shipping as well as oil and gas services provider, may reward its shareholders with a “surprise” dividend for the financial year ending Dec 31, 2014, following an extraordinary gain from the recent sale of its 15.7% stake in port operator, NCB Holdings Bhd, for close to RM222mil in cash.

The Petroliam Nasional Bhd (Petronas) subsidiary has been disposing of its non-energy related businesses in a bid to become a leaner corporation focusing on energy-related operations.

“The MISC management has hinted a stronger dividend per share (DPS) for the current financial year, if the fourth quarter earnings continue to be strong, which is a likely scenario,” said AllianceDBS Research in its report in August.

“Our FY14 DPS forecast is 10 sen, but this could be a surprise on the upside, given the improving balance sheet position.”

MISC has seemingly resumed regular dividend payments since 2013.

MISC had paid an interim DPS of four sen on Sept 24 this year, amounting to RM178.6mil.

Last year, the company paid a final dividend of five sen per share totalling RM224.5mil.

Late last month, it was announced that MMC Corp Bhd would acquire MISC’s stake in NCB for RM221.98mil cash, which would make it the second largest stakeholder in the port and logistics operator.

The offer price translated to RM3 per NCB share, or close to a 25% premium to NCB’s share price prior to the announcement.

Apart from the sale of its stake in NCB, the shipping giant’s 50%-owned joint venture, VTTI BV, in August, had listed six of its mature terminals – in Amsterdam, Rotterdam, Antwerp, Fujairah, Tanjung Bin and Florida – via the initial public offering (IPO) of VTTI Energy Partners.

The IPO is expected to net US$362mil or RM1.2bil for VTTI BV, even if the greenshoe option was not exercised.

“We expect the management to use part of the cash proceeds to expand its liquefied natural gas (LNG) shipping and offshore businesses, and fund future dividend payments,” said AllianceDBS.

MISC, which was hard hit by the unexpected global economic crisis in late 2008, began hiving off its bleeding and non-energy related businesses starting with the disposal of its container shipping division about two years ago.

Earlier in March this year, the shipping group announced it was disposing of its entire equity interest in wholly-owned MISC Integrated Logistics Sdn Bhd to Golden Age Logistics Sdn Bhd, a wholly-owned subsidiary of Utusan Printcorp Sdn Bhd, for RM250mil cash.

MISC trimmed down its stake in energy-related business in an effort to improve its balance sheet.

This include the sale of its 50% shareholding in Gumusut-Kakap Semi-Floating Production System (L) Ltd to Petronas Carigali Sdn Bhd’s wholly-owned unit, E&P Venture Solutions Co Sdn Bhd, for US$305.7mil (RM980.62mil) in October 2012.
Source: The Star