KUALA LUMPUR (Oct 29): Highway construction company WCE Holdings Bhd is close to securing a construction works contract worth RM126.8 million for a proposed access from the West Coast Expressway to a mixed development project in Kota Seri Langat.
In a filing with Bursa Malaysia yesterday, WCE said its wholly-owned subsidiary KEB Builders Sdn Bhd has entered into a memorandum of agreement with Seriemas Development Sdn Bhd to undertake, on a design, build and manage basis, the construction works of the access between the aforementioned highway and the development project.
"This proposed access will be known as the Kota Seri Langat ‘Left-In and Left-Out Interchange’ and includes the construction works of a bridge, main drainage, water pipes and associated works for a total consideration of RM126.8 million," WCE said.
It added that the project is expected to contribute positively towards the future earnings of the group. Other than the operational risks associated with the project, WCE said there are no foreseeable significant risks.
In August, WCE reported its fifth consecutive quarterly loss at RM30.89 million for the first quarter ended June 30, 2020 (1QFY21), mainly attributed to the recognition of interest expense of RM40.3 million under its toll concession segment, in respect of the financing costs for the West Coast Expressway on the sections which are completed and open for traffic.
On a quarter-to-quarter basis, the company recorded a higher net loss compared to RM11.99 million for 4QFY20. Its quarterly revenue also fell sharply by 63.34% to RM44.53 million from RM121.47 million.
In contrast, the company posted a net profit of RM9.23 million for the corresponding quarter a year ago (1QFY20). Revenue plunged 88.38% against RM383.19 million a year ago.
WCE is building the 233km West Coast Expressway tolled highway from Banting, Selangor, to Taiping, Perak, and it is being built on a build-operate-transfer basis, with a concession period of up to a maximum of 60 years.
The project is divided into 11 sections, and four sections have been opened for traffic and commenced tolling. Section 8 (Hutan Melintang — Teluk Intan) was opened for traffic on May 31, 2019, followed by section 9 (Kampung Lekir — Changkat Cermin) and 10 (Changkat Cermin — Beruas) on Sept 23, 2019, and section 5 (Bandar Bukit Raja — Kapar) was opened on Dec 10, 2019.
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