Gadang eyes better results next year

KUALA LUMPUR: Gadang Holdings Bhd, an investment holding company, expects better performance for its current financial year from its core business of engineering and construction.

Its managing director-cum-chief executive officer, Tan Sri Kok Onn, said he was confident earnings would improve if the company wins the projects it is bidding on and with the completion of its ongoing projects.

He said the company is actively participating in the Sungai Buloh-Kajang Klang Valley Mass Rapid Transit project and is confident of winning the bid.

"We also expect earnings with the expected completion of the Shah Alam Hospital at the end of 2013 and the runway project at the Low Cost Carrier Terminal (LCCT) in Sepang," he told reporters after the company's annual general meeting here today.

Kok said the company will continue to replenish its engineering division with selective construction projects that will provide margin enhancement to the company's bottom line.

"The company is also exploring water concession projects in China, Vietnam and Indonesia, but we will focus on Indonesia because of the huge demand for clean water while in China the water tariff is so low, it will not contribute so much to the company," he said.

Kok said the water supply business in Indonesia will continue to provide recurring income to the group.

For the 2011 financial year, the engineering and construction division contributed 80 per cent to the company's revenue, with another 20 per cent coming from the property development and water consession division, he said.

He added that despite revenue rising to RM350 million from RM270 million in the previous financial year, the company recorded a pre-tax loss of RM1.2 million mainly to higher write-off of bad debts and goodwill impairment of RM11.15 million. - BERNAMA