Corporate Results Update.

Compiled by DBS Vickers:

UOB’s 1Q08 results were in line with our expectations.

Annualised 1Q08 numbers were 6% lower than our full year estimates and 5% below consensus due to higher provisions set aside for its ABS CDOs. UOB further provided for another $43m against its profit and loss account.

Supporting the results were strong loan growth (18% y-o-y and 2% q-o-q) and higher NIMs of 2.20% (4Q07: 1.94%, 1Q07: 2.18%). Non-interest income was lower by 4% y-o-y and 22% q-o-q as expected due to mark-to-market losses coupled with lower fee income from fund management and investment-related activities, in line with the softer capital market conditions.

During 1Q08 UOB’s regional outfits performed well with the exception of Greater China due to a revaluation loss on the US$ capital injection. Excluding the revaluation loss, Greater China would have recorded a profit of S$26m rather than a loss of S$4m.

OCBC’s 1Q08 net profit came in at S$626m.

+12% y-o-y and 45% q-o-q. The disappointment is in GEH, which surprised on the downside with only a S$7m income contribution. Loan syndication fees were strong; no further provisions were made on CDOs. Maintain Buy, TP revised to S$9.80 (from S$9.00).

Net profit for StarHub came in below expectations.

Grew 15% y-o-y but fell 19% q-o-q to S$80.1m, mainly due to lower margins. Ahead of full mobile number portability, we do not expect competition to ease. Maintain Hold; target price of S$3.10. Management has guided for 10% revenue growth and 33% EBITDA margin in 2008.

1Q08 net profit for SembCorp Marine rose 24% to S$91.3m.

Turnover was down 4% yoy to S$916.1m. Sequential revenue and earnings should be higher in 2Q08 as we expect one semi-submersible and at least three jackups to hit the 20% milestone stage compared to only jackup in 1Q08. Maintain Buy with an unchanged TP of S$4.50.

Raffles Ed 3Q/9M results were in line with our expectations.

Revenue for 3Q grew 73% to S$49.2m, from S$28.4m arising from increased student enrollment, increased course fees and contributions from Zhongfa, Oriental University City (OUC) and Hefei Wanbo College (Wanbo). Contribution from OUC and Wanbo started in Jan 08.

Operating expenses grew 73%, which was in tandem with sales growth. This was due to staff costs and higher operating expenses as a result of its increased scale of operations. Gross margin for the quarter remained steady at 41.1%. Total student enrollment now stands at an estimated 26,900 students (excluding an estimated 23,000 students in Langfang Vocational Technical Institute and Langfang Health School).

1Q08 results for ARA were in line with our expectations.

Operational performance continued to grow strong from an increased AUM base. Gross revenues increasing 107% yoy to S$17.5m and net profit by 142% yoy to S$9.2m. We continue to like ARA for its asset light - fee income base model backed by stable real estate assets. Maintain Buy on ARA, TP S$1.13.

Compiled by OCBC Research:

DBS 1Q08 was ahead of market expectations.

DBS posted 1Q net earnings of S$603m, -2.3% YoY and +22.8% QoQ, and slightly ahead of market estimate of S$562m based on a Dow Jones Newswires poll. Interest Income rose 8.5% YoY (flat QoQ) to S$1,057m, while Non-interest Income fell 10.9% YoY (+6.8% QoQ) to S$506m, resulting in fairly flat total income of S$1,563m.

The gain in Interest Income came from the strong increase in loans growth, +5% QoQ and +21% YoY to S$114.2 billion (versus +19% YoY and +1.8% QoQ to S$94.4 billion for UOB). On the margin front, Net Interest Margin (NIM) slipped from 2.21% in 1Q07 and 2.11% in 4Q07 to 2.09% by 1Q08.

On the fee income side, the obvious declines came from stockbroking and wealth management. Net trading income sustained a net loss of S$161m, partly due to a charge of S$86m for Rosa. Costincome ratio improved slightly from 43% in 1Q07 to 42% in 1Q08. Nonperforming loan (NPL) rate also showed improvement from 1.5% to 1.0%. The group has declared a one-tier tax-exempt 1Q dividend of 20 cents per share.