MISC's changes in boardroom a concern

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

31 May 2010

For the record, its current president and chief executive officer Amir Hamzah Azizan would be resigning from his current position to assume a senior leadership position within (parent) Petroliam Nasional Bhd (Petronas). However, he would remain as a non-independent non-executive director of MISC.
Datuk Nasarudin Md Idris, currently a non-independent non-executive director of MISC would take over the helm of  MISC as the new president and chief executive officer effective June 15 this year. Datuk Nasarudin has been on the board of directors of the company since October 2004.
According to RHB Research Institute Sdn Bhd (RHB Research), the changes in the boardroom might be a concern, over the continuity of MISC’s current business strategy. The latest development as Amir was widely believed to have been ‘groomed’ and finally appointed o take over the position on January 1 last year, replacing Dato’ Shamsul Azhar Abbas, who is currently the president and chief executive officer of Petronas.
Among the risks that were brought into concern are the earlier-than-expected recovery in the shipping sector as well as the lower-than-expected bunker cost, added the research firm.
Looking at the company’s performance front, its petroleum, chemical and container shipping segments would continue to be weighed down by the subdued freight rates and volumes over the next one to two years on the back of the double-whammy of overcapacity and slow demand from the mild recovery in the global economy.
This eclipsed MISC’s investment case based on the steady income stream from its liquefied natural gas (LNG) division and high growth at its offshore and engineering businesses. Having updated its net debt.
RHB Research maintained its target price at a fair value of RM8.02 per share based on sum-of-parts (SOP).

Source: The Borneo Post