PETALING JAYA: Construction outfit Kerjaya Prospek Group Bhd has set a slightly conservative order book target for 2021 of RM1bil worth of jobs.
This is lower than its RM1.5bil target last year and the RM1.3bil it achieved in 2019.
Group chairman Datuk Tee Eng Ho said while there were commitments from their clients towards Kerjaya Prospek, it was not as large, so he did not set a higher target.
“It’s better to be conservative. And if we can surpass our target, it’s good for us.
“In terms of financial performance, we will do better than last year but not necessarily better than 2019, ” he told a virtual briefing on the group’s first-quarter results yesterday.
Kerjaya Prospek posted a net profit of RM26.39mil for the period ended March 31,2021, an 18.18% increase year-on-year (y-o-y), mainly due to the resumption of construction projects as compared to the same quarter last year which was affected by the movement control order (MCO).
Its revenue rose 26.83% to RM268.67mil.
Eng Ho noted that their profit margin however, was slightly affected by steel bar prices.
Steel bar comprises some 7% to 8% of the overall contract price for high end developments and it may hit up to 15% for lower cost projects.
Eng Ho said the prices were still manageable at its current range of RM3,100 to RM3,200 per tonne, unless it hits about RM5,000.
Meanwhile, chief executive officer and executive director Tee Eng Tiong said year-to-date (y-t-d), the group’s construction division managed to secure three contracts with a combined value of RM384.5mil, coming from both building and infrastructure works.
“We will continue to focus on delivering the projects in hand as well as aggressively tender for good projects that can deliver value to our shareholders.
“With improved property sales which have been on the rise recently due to pent-up demand, we are optimistic of the industry’s outlook and plan to launch two new property development projects in the second half of this year, ” he said.
The two new property development projects are Yakin Land and Monterez developments.
Eng Tiong added that with the reasonable price and good location, he believes the sales will be good and further enhances Kerjaya Prospek’s financial position.
The group’s outstanding order book as at March 31 is RM3.45bil, which will provide earnings visibility for the next three years. Its tender book size is still about RM1.5bil.