Gamuda 1Q18 profit up 25% YoY
Gamuda

By MARK RAO / Gaphic By TMR

GAMUDA Bhd turned in a stronger net profit of RM203.02 million for its first quarter ended Oct 31, 2017 (1Q18) up by 25.2% year-on-year (YoY), supported by the group’s construction business and international property sales.

In an exchange filing last Friday, the engineering, property and infrastructure group noted its revenue climbed 52.9% YoY to RM771.82 million.

“The increase in revenue and net profit were mainly due to higher work progress from the group’s various construction projects coupled with stronger overseas property sales and several new property projects in Malaysia,” the company said.

It is predicting an improved fiscal year supported by the project progress of the second line of the Klang Valley Mass Rapid Transit (KVMRT), stronger overseas and Malaysian property sales and steady earnings from its expressway concessions.

The group’s construction division brought in stronger pretax profit and turnover in 1Q18 due to higher work progress from the second line of KVMRT of which it is the project delivery partner and sole underground works package contractor.

As of November this year, 97% of the overall works packages from the public transport network were awarded amounting to RM30.8 billion, while the overall cumulative progress at the end of October was at 13.3%.

However, startup for underground works on the Sungai Buloh-Serdang-Putrajaya line was delayed at six out of ten stations due to major design changes instructed by the client — Mass Rapid Transit Corp Sdn Bhd (MRT Corp) — and late access to land required for the works from third parties.

The works are being carried out by a joint venture (JV) between MMC Corp Bhd and Gamuda, both of whom have made an acceleration proposal to MRT Corp outlining the measures needed to achieve the original commencement date on February next year.

Gamuda added that works on the Pantu Junction to Batang Skrang stretch of the Pan Borneo Sarawak Highway, which the group is undertaking via a JV, are progressing on schedule.

At the end of November this year, the project was 11.7% completed.

Managed by Gamuda Land Sdn Bhd, Gamuda’s property division turned in on improved revenue and pretax in 1Q18 after more than doubling its sales YoY to RM903 million.

This was mainly attributed to local property projects like Horizon Hills, Jade Hills and The Roberston; new launches in Gamuda Gardens and twentyfive.7; and stronger overseas sales from Vietnam-based projects, namely Celadon City in Ho Chi Minh and Gamuda City in Hanoi.

Gamuda’s pretax profit was up due to higher upfront cost for new townships and more affordable housing sold for the quarter.

Its property business is set to hit the targeted of RM3.5 billion in sales for the ongoing financial year, significantly higher than the RM2.4 billion achieved in the last financial year.

To date, the group’s property projects have a remaining gross development value of RM53.58 billion spread over 3,589 acres (1,452.42ha).

Gamuda’s infrastructure concessions in the form of expressways and tolls posted a flattish performance due to lower than expected traffic on the SMART Expressway which was offset by stable traffic volumes from other expressways under the group’s purview.

Gamuda said negotiations with the Selangor state government on the sale of water assets and operations of Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (Splash) — in which it holds a 40% stake — are still ongoing.

“The Selangor state government and the federal government are still finalising certain matters among themselves in order to complete the takeover,” it said.

“They have mutually agreed to extend the takeover deadline to July 4, 2018.”

It added that Splash will not incur a loss on disposal if the assets are sold at book value.

Gamuda declared a six sen dividend in 1Q18, which is payable on Jan 25 next year. , supported by the group’s construction business and international property sales.

In an exchange filing last Friday, the engineering, property and infrastructure group noted its revenue climbed 52.9% YoY to RM771.82 million.

“The increase in revenue and net profit were mainly due to higher work progress from the group’s various construction projects coupled with stronger overseas property sales and several new property projects in Malaysia,” the company said.

It is predicting an improved fiscal year supported by the project progress of the second line of the Klang Valley Mass Rapid Transit (KVMRT), stronger overseas and Malaysian property sales and steady earnings from its expressway concessions.

The group’s construction division brought in stronger pretax profit and turnover in 1Q18 due to higher work progress from the second line of KVMRT of which it is the project delivery partner and sole underground works package contractor.

As of November this year, 97% of the overall works packages from the public transport network were awarded amounting to RM30.8 billion, while the overall cumulative progress at the end of October was at 13.3%.

However, startup for underground works on the Sungai Buloh-Serdang-Putrajaya line was delayed at six out of ten stations due to major design changes instructed by the client — Mass Rapid Transit Corp Sdn Bhd (MRT Corp) — and late access to land required for the works from third parties.

The works are being carried out by a joint venture (JV) between MMC Corp Bhd and Gamuda, both of whom have made an acceleration proposal to MRT Corp outlining the measures needed to achieve the original commencement date on February next year.

Gamuda added that works on the Pantu Junction to Batang Skrang stretch of the Pan Borneo Sarawak Highway, which the group is undertaking via a JV, are progressing on schedule.

At the end of November this year, the project was 11.7% completed.

Managed by Gamuda Land Sdn Bhd, Gamuda’s property division turned in on improved revenue and pretax in 1Q18 after more than doubling its sales YoY to RM903 million.

This was mainly attributed to local property projects like Horizon Hills, Jade Hills and The Roberston; new launches in Gamuda Gardens and twentyfive.7; and stronger overseas sales from Vietnam-based projects, namely Celadon City in Ho Chi Minh and Gamuda City in Hanoi.

Gamuda’s pretax profit was up due to higher upfront cost for new townships and more affordable housing sold for the quarter.

Its property business is set to hit the targeted of RM3.5 billion in sales for the ongoing financial year, significantly higher than the RM2.4 billion achieved in the last financial year.

To date, the group’s property projects have a remaining gross development value of RM53.58 billion spread over 3,589 acres (1,452.42ha).

Gamuda’s infrastructure concessions in the form of expressways and tolls posted a flattish performance due to lower than expected traffic on the SMART Expressway which was offset by stable traffic volumes from other expressways under the group’s purview.

Gamuda said negotiations with the Selangor state government on the sale of water assets and operations of Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (Splash) — in which it holds a 40% stake — are still ongoing.

“The Selangor state government and the federal government are still finalising certain matters among themselves in order to complete the takeover,” it said.

“They have mutually agreed to extend the takeover deadline to July 4, 2018.”

It added that Splash will not incur a loss on disposal if the assets are sold at book value.

Gamuda declared a six sen dividend in 1Q18, which is payable on Jan 25 next year.