Protasco shines on strong order book

  • Business
  • Wednesday, 03 Jan 2007

PETALING JAYA: The prospects of construction company Protasco Bhd appear bright with its current outstanding order book of RM2.2bil from concessions, a RM246.2mil Kedah road project as well as its diversification into overseas projects, specifically in Libya. 

According to research house Netresearch-Asia Sdn Bhd, the company also had about RM348mil of unbilled portion of projects on hand by the financial year ended Dec 31, 2006. 

“Protasco's concessions provide a strong earnings buffer against uncertainties in the consecution sector, generating cash flows that could be leveraged with expectations of a favourable roll-out of the Ninth Malaysia Plan (9MP) projects,” the house said in a report last week.  

It said the company's concession projects, valued at RM2.2bil and comprising two federal road maintenance projects ending between 2016 and 2018 and one engineering concession ending in 2011, were expected to underpin the group's revenues.  

Non-concession projects' earnings, however, were only expected in the longer term.  

A key non-concession project in financial year 2007, according to Netresearch, is the RM246.2mil Kedah road project (Jalan Alor Star-Kuala Nerang-Durian Burung) as well as two infrastructure jobs in Libya, valued at RM106.4mil and RM6.1mil respectively. 

It said the company’s Libyan ventures were not expected to provide significant earnings relative to domestic earnings at this stage.  

“Earnings potential is anticipated to be fully realised in the longer term,” it said.  

On the whole, the company remained optimistic that the roll-out of the 9MP projects would provide more earnings opportunities for it.  

Netresearch said Prostasco was poised to tap the growth opportunities, buoyed by a net cash position of RM87mil as at the third quarter of financial year 2006.  

Its cash-generating concessions could also be used to fund new ventures, moving forward, it added. 

 PRTASCO :  [Stock Watch]  [News]

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