Quarterly Report For The Financial Period Ended 31 December 2017
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Condensed Consolidated Statement Of Profit Or Loss And Other Comprehensive Income For The Fourth Quarter Ended 31 December 2017
Condensed Consolidated Statement Of Financial Position As At 31 December 2017
Review of Performance
For the current quarter and current financial year to date under review, the Group recorded revenue of RM41.1 million and RM145.6 million respectively.
- Analysis of our revenue by activities is as follows:-
- Analysis of our revenue by geographical locations is as follows:-
- Profit after tax ("PAT")
- Our unbilled order book as at 30 September 2017 is as follows:
During the year 2017, our newly secured projects which includes East Coast Rail Line (“ECRL”) scheme design and preliminary design, Kuala Lumpur-Singapore High Speed Rail (Reference Design Consultants 05), Consultant for External Infrastructure Works for Bukit Bintang City Centre and Proposed Tun Razak Exchange (TRX) External Roads has contributed to the major proportion of engineering design revenue. However, this was compensated by the completion few projects including LRT Ampang Line Extension and Westports Construction and Completion on Land Reclamation works, Container Yard and Wharf .
Our major on-going supervision projects including Maju Expressway Extension To KLIA, Sungei Besi-Ulu Kelang Elevated Expressway and West Coast Expressway which are progressing well in line with the construction stage of these projects continued to contribute majority of the supervision revenue. However, this was offsetted by completed project, i.e. LRT Ampang Line Extension in line with its completion status.
The revenue from project management improved significantly for both current quarter and year to date ended 31 December 2017 due to the contribution from MRT Line 2 –Jajaran Sg. Buloh-Serdang-Putrajaya which is progressing as per schedule. In addition, existing project management projects includes Kwasa Damansara Township Development and Projek Membaikpulih dan Menariktaraf Landasan Keretapi di Sektor Pantai Timur have also contributed to project management revenue.
BIM services accounted for small proportion of the Group’s revenue. The reduction in revenue for both current quarter and financial year to date were mainly due to the completion of certain BIM projects.
Reimbursable income is recognised on a back to back basis with sub-consultant and allowances claimed by supervision staff and therefore it has no significant impact on the financial performance of the Group regardless of the decline or rise in reimbursable income.
Local market continued to contribute significant portion of revenue amounting to 98.0% of the Group’s total revenue. The higher revenue posted by Malaysia segment was attributed to local projects explained in section (a) above.
The PAT grew by 7.1% or RM1.0 million to RM15.0 million for the 12 months ended 31 December 2017 from RM14.0 million recorded in previous corresponding period ended 31 December 2016 mainly attributable to higher gross profit achieved for the current period coupled with higher other income and consistent administrative and operating expenses and finance costs.
The PAT recorded for the current quarter ended 31 December 2017 is RM6.0 million mainly attributable to gross profit of RM16.7 million achieved and no significant increase in the total operating expenses in the current quarter.
The above unbilled order book will be billed progressively on average over the next two (2) to five (5) years.
- As disclosed in section B6, we targeted to complete the acquisition of SMHB Engineering Sdn Bhd Group (“SMHB Engineering Group”) by end of March 2018. SMHB Engineering Group is principally providing engineering consultancy services primarily in water infrastructure sector with more than 35 years of expertise and experiences in the water sector. In view of this, the Board of Directors is of the view that through SMHB Engineering Group, our enlarged Group will be able to leverage on their expertise and track record in the water sector to win tenders for any of the water-related contracts which we foresee will continue to receive strong government support given their strategic importance to the country. Post acquisition, we expect the synergy created from both leading engineering consultancy firms will take our Group to a greater heights which shall translate into record revenue and profits.
- As disclosed in our announcement to Bursa Securities on 6 February 2018, the Group has put in place a series of future plans as follows:- [a] Continuous enhancement on its Building Information Modeling (“BIM”) services which will be made mandatory in 2019 for public projects worth RM100 million in Malaysia;
[b] Proposed venture into a fourth (4th) core service i.e. facility management to develop a steady long term income business model; [c] Geographical expansion into ASEAN and India regions; and [d] Venturing into the provision of support services to the power generation sectors which are expected to continue receiving strong government support given their strategic importance to the country.
Premised on the aforesaid plans (i) and (ii), the Group expects to perform satisfactorily in the financial year 2018 given the strong order book, underpinned by the positive outlook in the construction and water industry both locally & regionally, driven largely by government continued spending on infrastructure projects.
Barring any unforeseen circumstances, the Board of Directors of the Company is of the opinion that the prospects for the remaining period to the end of the financial year ending 31 December 2018 will remain favourable.