Gadang’s 1Q net profit rises 118.66% on higher property contribution

by **Cals** Fri 30 Oct 2015, 03:06

Gadang’s 1Q net profit rises 118.66% on higher property contribution

By Gho Chee Yuan / theedgemarkets.com | October 29, 2015 : 6:18 PM MYT

KUALA LUMPUR (Oct 29): [size=16]Gadang Holdings Bhd ([You must be registered and logged in to see this image.] Valuation: 2.40, Fundamental: 1.70) saw its net profit for the first quarter ended Aug 31, 2015 (1QFY16) surge 118.66% to RM20.86 million or 9.61 sen per share from RM9.54 million or 4.41 sen per share a year ago.

The civil engineering and construction outfit said the better net income was driven by higher contributions from property activities.

Revenue for the quarter came in 12% higher at RM149.38 million from RM133.36 million in 1QFY15.

No dividend was declared for the quarter under review.

In a filing with Bursa Malaysia today, Gadang said profit before tax of its property division surged 348.8% to RM16.65 million from RM3.71 million last year.

"This was mainly due to higher development progress for various projects and changes in accounting estimates for revenue recognition treatment for Capital City Project," it added.

On its prospects, Gadang expects earnings to improve in the current financial year ending May 31, 2016 (FY16), driven by the strong outstanding order book of some RM805 million for the construction division, which is the core revenue generator for the group.

On the property division, it said the earnings will be underpinned by unbilled sales of some RM189 million, while the utility division will continue to provide stable earnings growth.

Shares in Gadang closed three sen or 1.95% higher at RM1.57, the highest point since May 21 this year.

At RM1.57, the counter has a market value of RM366.78 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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