Gadang sees FY14 revenue exceeding FY13’s RM354.07m

by **Cals** Fri 25 Apr 2014, 02:04

Business & Markets 2014

Written by Levina Lim of theedgemalaysia.com

Thursday, 24 April 2014 10:28

KUALA LUMPUR: Gadang Holdings Bhd is confident that its revenue for the financial year ending May 31, 2014 (FY14) will exceed FY13’s revenue of RM354.07 million, based on its performance in the first two quarters.

“Our growth is definitely much better than last year’s. If you look at the second quarter (2Q) [ended Nov 30, 2013 revenue of RM254.47 million compared with RM171.28 million in the previous corresponding period], the growth has almost doubled. We expect FY14 revenue to be double that of FY13,” Gadang chief financial officer Kok Pei Ling told reporters after its extraordinary general meeting (EGM) here yesterday.

The construction and property group will release its 3QFY14 results today.

Earlier at the EGM, a resolution was passed for a proposed joint venture (JV) between its wholly-owned subsidiary, Achwell Property Sdn Bhd (APSB), and Capital City Sdn Bhd for an integrated development in Johor Baru.

The RM1.8 billion development is located in Zone A of the Iskandar region, comprising a retail podium, hotel and office suites.

Kok said Gadang aims for an order book of at least RM300 million every year.

“We hope to have at least RM300 million to RM500 million [in our] order book every year. That’s the target that we are looking at,” she said.

Kok said the group is currently bidding for RM6 billion worth of construction projects locally and abroad, adding that Gadang has an average success rate of 50%.

The projects include the Klang Valley Mass Rapid Transit Line 2 (MRT Line 2), the West Coast Expressway, the Sungai Besi-Ulu Kelang Expressway, the Kinrara-Damansara Expressway, the Maju Expressway extension and a co-generation power plant in Pengerang, Johor

She said Gadang had submitted bids of about RM400 million for Phase 2 of the earthworks project at the refinery and petrochemicals integrated development (Rapid) project in Pengerang. Gadang was the beneficiary of Pengerang’s first earthworks package worth RM313 million.

On the progress of the construction of its RM410 million hospital in Shah Alam, Selangor, Kok said it is due for completion at the end of the year.

Gadang Land Sdn Bhd managing director Ling Hock Ling expects tenders for MRT Line 2 to be called at the end of this year or early next year.

Meanwhile, the gross development value of Gadang’s property projects to be launched in FY15 is estimated to range between RM200 million and RM300 million.

David Lam, Gadang’s director of regional utilities, said the group is scouting for additional acquisitions in Indonesia and is currently conducting a feasibility study and the necessary due diligence for the acquisition of two mini hydro plants there.

“We are looking for more acquisitions,” he said, adding that the water treatment business contributes about 10% to Gadang’s bottom line.

This article first appeared in The Edge Financial Daily, on April 24, 2014.