Gamuda Q1 earnings flat at RM162m, div 6c

RHB Research says it likes Gamuda for its exposure to the Mass Rapid Transit and Penang transport infrastructure.

KUALA LUMPUR: Gamuda Bhd posted flat earnings in the first quarter ended Oct 1, 2016 due to lower contribution from its property division but it remained upbeat due to its unbilled record orderbook of RM9bil.

The infrastructure-property company said on Friday its earnings came in at RM162.14mil compared with RM161.23mil a year ago. Its revenue dipped 1.5% to RM504.88mil from RM512.79mil a year ago.

Earnings per share were unchanged at 6.7 sen while it declared an interim dividend of six sen a share.

“The group anticipates a good performance this year from the steady earnings of expressway concessions division and the ramping up of works for the Klang Valley Mass Rapid Transit (KVMRT) Line 2. 

“The property division’s performance is expected to pick up in the next few quarters due to the launches of several new projects in Malaysia and overseas. The construction unbilled order book stands at a record RM9bil,” it said in a statement to Bursa Malaysia.

Elaborating on its first quarter results, Gamuda said the decrease in revenue was mainly due to tapering of underground and elevated works of the KVMRT – Line 1. The increase in profit before tax for current quarter mainly resulted from the toll rate hikes of certain expressways.

On the construction division, it said the lower revenue was mainly due to the tapering of underground and elevated works of the KVMRT - Line 1. The increase in profit before tax for current quarter is mainly due to cost saving arising from near completion of KVMRT – Line 1.

As for the property division, it said the lower revenue and profit before tax was due to the softening of the property market in Malaysia. However, sales from properties in Vietnam and Singapore continued to improve.

As for the water and expressway division, Gamuda said the increase in revenue and profit before tax mainly resulted from the toll rate hikes of certain expressways.

However the profit before taxation of RM206mil was lower that the preceding quarter's RM210mil mainly due to lower contribution from property division due to softening of the property market in Malaysia.

On the outlook for the property division, it said sales continued to be weak on the back of the soft market. 

“However, sales are expected to pick up in the next few quarters due to the launches of several new projects.

“Kundang Estates, an 89-acre boutique development in Sungai Buloh North offering modern countryside living with a total GDV of RM600mil was launched at end November 2016,” it said.

Gamuda said on the day of the launch, all non-bumi units available for sale were snapped up by customers while the bumi units received encouraging response.