KUALA LUMPUR (July 27): Gadang Holdings Bhd's net profit in its fourth quarter ended May 31, 2017 (4QFY17) slid 3.5% to RM29.99 million from RM31.07 million in 4QFY16, as revenue fell.

Also pulling profit down were higher income tax expenses and foreign exchange losses, as well as losses from its discontinued plantation division.

Quarterly revenue declined 33.8% to RM163.78 million, from RM247.5 million a year ago as revenue from the construction division declined by 50.03% to RM89.95 million from RM180.02 million previously.

It proposed a first and final single tier dividend of three sen for FY17, down from seven sen last year.

For its full FY17, Gadang registered a net profit of RM100.38 million, up 5.92% from RM94.77 million in FY16, mainly due to improved profit margins from construction projects and higher contributions arising from property activities. Revenue, however, retreated 19.4% to RM542.8 million from RM673.53 million last year.

Earlier this month, Gadang said it was selling its indirect wholly-owned plantation unit Desiran Impian Sdn Bhd to Kumpulan Sawit Tan Holdings Sdn Bhd for RM15 million, in tandem with its strategy to reallocate its resources by exiting non-core and loss-making businesses.

Looking ahead, Gadang said its construction division has an order book of RM1.5 billion, with RM136.2 million in unbilled sales for its property division.

“The mini hydro project of 9MW in Indonesia is expected to be income generating by the fourth quarter of the financial year,” it added, which will be the main driver for its utility division moving forward.

Shares of Gadang last closed two sen or 1.54% lower at RM1.28, giving it a market capitalisation of RM854.67 million. — theedgemarkets.com

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