Gamuda profit at RM102.8mil in fourth quarter
Fourth-quarter results were hit by one-off impairment charge
PETALING JAYA: Gamuda Bhd’s net profit dropped by almost a third to RM102.8mil in the fourth quarter ended July 31 due to an unexpected impairment charge on the Smart expressway.
Excluding the one-off charge, the construction group’s normalised pre-tax profit rose to RM279mil compared with RM210mil in the same quarter last year.
Net profit for financial year 2017 (FY17) stood at RM602mil, which came in lower than market projection, as revenue soared to RM3.2bil. Consensus estimate for Gamuda was at RM690mil.
“The group set aside RM98mil as a one-off provision for impairment on the Smart expressway as a result of the lower-than-expected toll revenue projections in the year ended 2017,” Gamuda said in a filing with Bursa Malaysia.
It added that the increase in revenue and normalised pre-tax profit for the fourth quarter and the full year were mainly due to the higher work progress of various construction projects and better property sales.
The company expects its performance to improve next year.
“The group anticipates a better performance next year as the Klang Valley mass rapid transit (MRT) Line 2 progress picks up pace, and with steady earnings of the expressway division,” it said.
The MMC Corp Bhd–Gamuda joint venture is the project delivery partner for the MRT Line 2 project (Sg Buloh-Serdang-Putrajaya). The overall progress of the project had reached 11% as at end-August.
MRT Line 1 was completed in December last year and is currently in operation.
Gamuda said its property division had achieved full-year sales of RM2.4bil for FY17, a 14% increase from last year.
The better performance is attributed to stronger overseas sales, especially in Vietnam, as well as local projects such as Horizon Hills, Jade Hills, The Robertson and Bukit Bantayan Residences.
Overseas projects from Vietnam, Singapore and Australia contributed 56% of the division’s sales.
“The property division’s performance is expected to be stronger next year due to the launch of several new projects in Malaysia and overseas,” Gamuda said.
Meanwhile, the group said that negotiations with the Selangor state government on its plan to acquire water assets and operations of Syarikat Pengeluar Air Sungai Selangor Sdn Bhd were still ongoing.
“The Selangor and federal governments are finalising certain matters among themselves to complete the takeover. They have mutually agreed to extend the deadline for completion of the takeover to Oct 5, 2017,” it said.