Apple profit up 15 pct, helped by iPhones, laptops

Apple Inc., the closest thing the tech industry has to a luxury brand, said Tuesday its profit jumped 15 percent in the most recent quarter despite the recession. IPhone revenue surged and reduced prices pushed laptop sales higher, even as the rest of the PC industry shrank.

The company, which recently welcomed CEO and co-founder Steve Jobs back from medical leave, said earnings in the quarter that ended June 27 rose to $1.23 billion, or $1.35 per share. Apple's profit was $1.07 billion, or $1.19 per share, in the same period last year.

Sales increased 12 percent to $8.34 billion from $7.46 billion in the year-ago quarter, which is the third in Apple's fiscal calendar.

Apple beat Wall Street's forecast on both counts, which helped send its stock higher in extended trading. Analysts were expecting Apple to earn $1.17 per share on $8.20 billion in revenue, according to a Thomson Reuters survey.

"In a better economy I think we would have sold even more," Apple Chief Financial Officer Peter Oppenheimer said in an interview.

Apple said it sold more than 5.2 million iPhones in the quarter, more than seven times what it sold in the 2008 quarter, thanks in part to a newly released version of the device.

Apple also sold 4 percent more Mac computers than a year ago, with a 13 percent rise in laptop unit sales more than making up for a 10 percent drop in desktops. Meanwhile, researchers recently reported a 3 percent to 5 percent decline for the overall worldwide PC market in the same period.

"Times are tough. Apple continues to post pretty strong numbers," said Shaw Wu, an analyst for Kaufman Bros. "It's pretty incredible. It truly is."

Apple's decision to cut laptop prices during the quarter helped it buck the industry trend, even though the move dragged laptop revenue down 2 percent. Tim Cook, Apple's chief operating officer, said Mac sales picked up after the company announced the cuts, its first major price reductions in the recession.

Cook said Mac revenue was also hurt as businesses that typically buy more expensive models continued to put off technology spending. Other computer makers, such as Dell Inc., have also said customers are holding on to their existing machines for longer than normal.

Wu noted that lowering prices didn't eat into Apple's gross margin, which improved from a year ago and beat his expectations. Apple said component costs weren't as high as anticipated, and Wu said he thinks the Mac remained one of Apple's most profitable businesses.

The main weak spot was Apple's iPod line. Even though iPod Touch unit sales more than doubled, total iPod unit sales fell 7 percent, hurt by declines in what Apple considers its traditional MP3 players -- iPod Classic, Nano and Shuffle. Oppenheimer told analysts on a conference call that such declines are to be expected as Apple "cannibalizes" iPod sales by offering similar features, plus access to thousands of third-party applications, on the $229-and-up iPod Touch and the iPhone -- the cheapest of which is now $99, plus a monthly service contract.

Apple's revenue increased in every region, including the U.S. and Europe. Average revenue in each of Apple's retail stores was $5.9 million, lower than the $6.8 million Apple reported at the same time last year.

Shares of Cupertino, Calif.-based Apple jumped $6.77, or 4.5 percent, to $158.28 in after-hours trading, after slipping $1.40 to close at $151.51.

For the current fourth quarter, Apple said it expects to earn $1.18 to $1.23 per share on $8.7 billion to $8.9 billion in sales. Analysts are looking for a stronger performance -- profit of $1.30 per share on revenue of $9.1 billion -- but Apple's guidance is typically conservative.

Bank Negara Malaysia Investigates Genneva Sdn Bhd and Etika Emas Estet Sdn Bhd

Bank Negara Malaysia has commenced investigations into Genneva Sdn Bhd and Etika Emas Estet Sdn Bhd under suspicion of conducting illegal deposit taking activities in breach of subsection 25(1) of the Banking and Financial Institutions Act 1989 (BAFIA).

The raids on Genneva Sdn Bhd and Etika Emas Estet Sdn Bhd were conducted today at their premises in Klang Valley following information received from members of the public.

Members of the public are reminded to be cautious of deposit taking schemes and investment schemes offered through various channels such as the internet, phone calls, or seminars conducted by individuals or companies that are not licensed or approved by the relevant authorities.

Members of the public may refer to the list of licensed institutions authorized to accept deposits which is available on Bank Negara Malaysia's website ( www.bnm.gov.my).

For further enquiries, members of the public can contact Bank Negara Malaysia at the following contact points:

BNMTELELINK (Customer Service Call Centre)
Tel: 1-300-88-5465
Fax: 03-21741515
Email: bnmtelelink@bnm.gov.my

BNMLINK (Customer Service Walk-In-Centre)
Block D, Bank Negara Malaysia ,
Jalan Dato' Onn, 50480, Kuala Lumpur
(Business hours: Monday-Friday, 9.00 am - 5.00 pm)

Bank Negara Malaysia
21 July 2009

How to become a gold investor

GOLD investing is not simply a matter of buying a piece of the metal to lock in a safe place. There are many ways to own gold and, quite often, you do not see the actual thing at all. For instance, Singaporeans can buy gold by using their Central Provident Fund Ordinary Account savings to invest in gold savings accounts or gold certificates. Their value mirrors any rises or falls in gold prices.

Bars and coins

ONE way to get your hands on gold is to buy products such as gold bullion coins and gold bars in various sizes and weights. These investments - unlike a paper gold investment - are subject to goods and services tax (GST) in Singapore, which means an investor will lose 7 per cent of his investment upfront.

Coins are usually available in denominations of one ounce, 1/2 ounce, 1/4 ounce, 1/10 ounce and 1/20 ounce.

When investors sell gold to a bank, for instance, the institution will want to make a profit on the prevailing gold price. That differential starts from about S$120 per kg.

Banks that sell physical gold include United Overseas Bank (UOB) and the Canadian Bank of Nova Scotia.

Certificates

WHEN you buy a gold certificate, you do not incur GST, as you do when you buy physical gold. However, there is an annual administration fee of S$30 per kg of gold.

At UOB, a gold certificate is issued in 'kilobars', which are kilogram bars of gold. In a single certificate, you can buy kilobars of 999.9 fine gold in multiples of one up to a maximum of 30. Gold is rated according to its purity - and 999.9 means extremely pure.

At current gold prices, one kilobar costs about S$35,000.

For die-hard gold investor and retiree Christopher Na, it has been a painful wait to see his investment shine. His foray into gold began in 1993 when he pumped his life savings of about S$200,000 into 11kg of gold, which he bought at US$330 (S$483) per ounce.

He prefers to buy gold certificates as they do not incur GST. He also opted for certificates because he wanted to buy more gold by borrowing money using his certificates as collateral.

So far, he has piled up 29kg of gold in gold certificates from UOB and has taken out bank loans of about $500,000. Based on the current price of US$760 an ounce, his 29kg investment is worth about $1 million.

Mr Na does not mind paying the monthly loan interest of S$3,000. 'As long as the price of gold rises beyond what I pay for the interest, I will keep on buying gold.'

Savings accounts

AN INVESTOR looking for the excitement of frequent trading might want to consider a gold savings account.

You start with a minimum purchase of 5g of 999.9 fine gold. You can then buy or sell in 1g lots.

The customer records his purchases and sales in pocket-sized passbooks as deposits and withdrawals. UOB charges an administration fee that is subject to GST.

Margin trading

CUSTOMERS can also open a margin trading account to trade London gold or gold futures over the phone on a margin basis.

They can even sell short in gold with the account.

Unit trusts

ANOTHER option is to invest in unit trusts such as UOB United Gold and General, which invests in publicly listed companies that mine gold.

As with other unit trusts, an investor is subject to subscription and annual management fees, said IPP Financial Advisers investment director Albert Lam.

Exchange-traded fund (ETF)

FOR retail investors, an ETF offers a convenient way to buy gold with relatively modest sums, and without the custody, storage and insurance charges that typically accompany bullion investments.

An ETF is listed on a stock exchange, and is bought and sold just like shares.

In February, investor Dennis Ng pumped 5 per cent of his investment portfolio into StreetTRACKS Gold ETF. Since then, the value of his investment has risen nearly 20 per cent, to US$75 a share. His initial investment cost him US$63 a share.

Already listed in New York and Mexico, this gold ETF was listed on the Singapore Exchange last year.

ETFs are tracker funds that invest in the component stocks of an index. Investors need not pay a sales charge, unlike with a unit trust. They are, however, subject to a brokerage charge. Overhead costs are typically a fraction of those for unit trusts.

Unlike other ETFs that hold shares or bonds, StreetTRACKS holds gold bullion as its underlying asset. Its annual management fee is 0.4 per cent. A share in the ETF is based on roughly a tenth of an ounce of gold. Buy 10 shares and you own one ounce of gold.

Mining stocks

THIS means investing directly in the shares of mining firms. However, you could be exposed to more risks.

With most gold investments, you worry mainly about the price of gold. With these stocks, other factors, such as how well the firms are managed, come into play.