KUALA LUMPUR : Softer market conditions in Canada coupled with the fall in oil and gas prices has had a sharp impact UEM Edgenta Bhd's 61%-owned Opus International Consultants Ltd (OICL) which reported a trading loss of C$5.2mil (RM16.58mil).
In a statement today, the New Zealand Exchange-listed firm said that OICL's engineering and geomatics consulting firm Opus Stewart Weir (OSW) was negatively impacted by the softer Canadian market throughout this year.
“In the five months to May 2016, work in hand at OSW has fallen from 47% to 33%, reflecting widespread project deferrals and less new work from clients. The management's very focused responses are expected to achieve a better second half trading outcome,” said OICL.
OSW's business is typically seasonal with a stronger second half performance, the group noted. On the other hand, the Canadian government's C$60bil infrastructure package has yet to benefit markets while Alberta has announced an additional C$40bil of infrastructure spending, it noted.
Elsewhere, OICL's Australian business has improved compared to last year but has not yet lifted to profitability, while the rest of the group's business remains positive, including the non-OSW Canadian segment.
“While many aspects of the business have been transformed, markets remain less robust than we would like, and there is both upside and downside in the outlook for the second half of the year,” said OICL's chief executive officer David Prentice.
On May 27, UEM Edgenta reported a net profit of RM20.49mil for the quarter ended March 31, down from RM37.17mil a year ago.
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