Introduction

HEB wishes to announce that its associate company, HSS Integrated Sdn Bhd ("HSSI"), has on 30 August 2016 accepted a letter of appointment from the Ministry of Transport Malaysia appointing HSSI as the Independent Checking Consultant for “Projek Membaikpulih dan Menariktaraf Landasan Keretapi di Sektor Pantai Timur” comprising of:

1. Rehabilitation of Track Formation, Replacement of Ballast and Associated Works between Jerantut, Pahang to Gua Musang Railway Station, Kelantan;

2. Restoration of Track and Slope Stabilisation, Track Rehabilitation and Associated Works due to Major Flood between Gua Musang and Tumpat Railway Station, Kelantan; and

3. Restoration, Strengthening and Substructure Protection for Bridges, Trackworks and Associated Works due to Major Flood between Gua Musang to Wakaf Baru Railway Station, Kelantan;

(“Contract”).

Information on the Contract

The Contract is for a period of 48 months with a value of RM13,713,780. The Contract is expected to commence at the end of the third quarter of 2016 and completed within the third quarter of 2020. Pursuant to the exclusive teaming arrangement between HSSI and HEB’s wholly-owned subsidiary, HSS Engineering Sdn Bhd ("HSSE"), HSSI and HSSE will be collaborating exclusively to execute and complete the Contract. 

Financial Effects

The Contract will not have any material impact on the net assets and earnings of HEB Group for financial year ending 2016.  However, it is expected to positively contribute to HEB Group’s future earnings.

The Contract will not have any impact on the share capital and/or shareholding structure of HEB.

Directors’ and major shareholders’ interests

None of the Directors and/ or Major Shareholders of HEB and persons connected to the Directors and/ or Major Shareholders of HEB have any interest, direct or indirect, in the Contract.

Risk Factors

The risk factors affecting the Contract include, but not limited to, execution risks such as availability of skilled manpower and dependency on the progress of the works given the role pursuant to the Contract is to provide independent checks of the works. HEB Group has, throughout the years, established its track record and expertise to undertake such projects. As such, the Board of Directors believe that HEB Group is able to mitigate the aforesaid risk factors.

Directors’ Statement

The Board of Directors, after considering all the relevant factors, is of the opinion that the acceptance of the Contract is in the best interest of HEB Group.

This announcement is dated 30 August 2016.