Gamuda’s 2Q profit falls 12% to RM160.11m

KUALA LUMPUR (March 25): Gamuda Bhd, which is involved in construction and property as well as water concessions, saw a 12% drop in net profit in its second financial quarter ended Jan 31, 2016 (2QFY16) to RM160.11 million, from RM182.18 million a year ago.

In a bourse filing, Gamuda attributed the drop to the softening of the domestic property market and tapering of underground and elevated works of the Klang Valley mass rapid transit (KVMRT)-Line 1 project.

Revenue for 2QFY16 was 19.2% lower at RM527.43 million, from RM653.24 million a year ago.

For the first half of FY16 ended Jan 31 (1HFY16), Gamuda’s net profit was RM321.35 million, 12.7% lower than the RM368.03 million it reported last year; while revenue fell 14.9% to RM1.04 billion, from RM1.22 billion in 1HFY15.

Gamuda, through its joint venture company with MMC Corp Bhd, MMC Gamuda KVMRT (PDP) Sdn Bhd, is the project delivery partner (PDP) for the Sungai Buloh-Kajang MRT Line 1. As at February 2016, the project was at 79% completion.

“The project is on target for Phase 1 completion in December 2016 and full completion by July 2017, with no significant cost overruns so far,” said Gamuda.

As for the Sungai Buloh-Serdang-Putrajaya line (MRT Line 2), which Gamuda, together with MMC, are the PDP, Gamuda said that five advance works packages had been awarded, with another sixteen tenders, including four main viaduct packages, under way. Two of the main viaduct packages are expected to be awarded in April, with another two slated for mid-2016.

As for the Penang Transport Master Plan, which Gamuda’s 60%-owned SRS Consortium is the PDP, it said talks on the scope and terms of the PDP agreement are ongoing. The deal is expected to be executed by this June.

Gamuda’s property division saw RM385 million sales in 1HFY16, down 28% from the RM535 million it registered in 1HFY15 due to the weak property market, especially in Iskandar Johor. Unbilled sales at end-2QFY16 was RM1 billion.

On the takeover of its water concessions holder Syarikat Pengeluar Air Selangor Holdings Bhd by the Selangor government, Gamuda said talks with the state are ongoing.

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This article first appeared in The Edge Financial Daily, on March 25, 2016. Subscribe to The Edge Financial Daily here.