NWP’s unit RM30m contract win marks foray into construction sector, says CEO

by TMR / pic by TMR FILE

NWP Holdings Bhd’s move to diversify into the construction business has begun with the RM30.4 million contract to supply and install aluminium formwork systems and undertake skim coating works at two development sites in Klang Valley.

The company’s wholly owned subsidiary, NWP Construction Sdn Bhd, will undertake the works for client Pembinaan Bintang Baru Sdn Bhd.

“NWP is poised to leverage its key management’s extensive experience to expand its construction arm. We are excited about our new ventures to be key earnings contributors for our group in the near term. The secured projects are vital to our profile in the industry,” NWP CEO Kenny Yap said in a release on Tuesday, with the contract marking NWP’s foray into the construction business.

The award sees NWP Construction appointed as the subcontractor to undertake the supply and installation of aluminium formwork system and skim coating works for a building in Shah Alam, Selangor and two blocks of 57-storey serviced apartment with seven storeys of car parks known as M Luna in Kepong, Kuala Lumpur.

The projects are estimated to be completed between 15 months and 18 months from the commencement date.

NWP has attracted investor interest recently after Kejuruteraan Asastera Bhd’s (KAB) founder and MD Datuk Lai Keng Onn emerged as a substantial shareholder in NWP in early November.

Lai bought some 28.6 million shares or 5.414% interest in NWP from the open market which resulted in a sharp spike in its share price and volume traded leading to an unusual market activity query by Bursa Malaysia Securities Bhd.

NWP shares rose 20 sen low on Nov 3 to a high of 39.5 sen on Nov 17 before its price retraced lower to hit a low of 19.5 sen on Dec 22.

Lai has raised the stake in NWP to 5.6% since and holds a 29.79% stake in KAB.

His emergence as a shareholder has been accompanied by changes in the NWP’s boardroom.

The contract award saw NWP shares close 1.5 sen or 6067% higher at 24 sen yesterday.

The timber-based product producer and trader recorded a net loss of RM2.791 million in its second quarter ended Aug 31, 2021, on revenue of RM1.47 million.

In its exchange filing, NWP stated the loss in the quarter was due to higher working capital in terms of staff costs and administrative expenses, to support the diversification of the new businesses of the group.

The smaller revenue figure for the quarter year-on-year was partly due to the implementation of Full Movement Control Order from June to August this year by the government, where the production and shipment of goods and raw materials had come to a halt.