CIMB Research: Malakoff Corp is facing a challenging year

Despite the weak earnings, CIMB Research maintained its Hold call on Malakoff.

PETALING JAYA: Independent power producer, Malakoff Corp Bhd (Malakoff) is facing a challenging year after declaring a 20% decline in year on year profit for the fourth quarter of the financial year 2016 (4Q16) to RM89mil from RM112mil with expectations of a further decline in 2018.

Research house CIMB attributed the drop in core net profit to higher depreciation and amortisation charges as the company changed its depreciation policy in 3Q16 which resulted in lowered residual values of its power plants and higher annual depreciation charges.