PETALING JAYA: Mudajaya Group Bhd
has achieved a favourable outcome at the Court of Appeal in its long-running fund misappropriation case against former employee Michael Chua Khian Keng, with the compensation award raised to RM72.2mil from RM43.5mil previously granted by the High Court.
In a filing with Bursa Malaysia, the group said the appellate court ruled in its favour on the primary claims and reliefs sought, although the revised sum will be subject to deductions for amounts already recovered.
The court also awarded Mudajaya costs of RM150,000, while dismissing Chua’s appeal with costs of RM50,000.
The case relates to alleged misappropriation of funds involving Chua and his wife, Tan Kah Lua, linked to a RM720mil power plant project awarded in June 2011.
The dispute originated in 2015 following an internal review of additional costs incurred on the project, which was first disclosed in the group’s fourth-quarter results for the financial year ended Dec 31, 2014 (FY14).
Mudajaya said the internal investigation identified irregular transactions contributing to cost overruns, but noted that the issue was isolated to a single former employee and confined to one project.
Despite the higher compensation, the group does not expect the ruling to have a material impact on its financial performance for FY26 until the judgment sum, interest and legal costs are fully recovered.
The constructor said it will provide further updates as the case progresses.
Mudajaya’s shares closed unchanged at 36.5 sen yesterday, giving it a market capitalisation of RM194mil. The stock has declined 23.2% over the past year.
For FY25, the group garnered a net profit of RM11.8mil, on a revenue of RM230.1mil.
These figures were lower than what was achieved for FY24, with Mudajaya pointing to lower contributions from its construction segment and the cement business within the manufacturing and trading segment.
In particular, it added that the lower profitability on FY25 was primarily because the corresponding period of the preceding year included the aforementioned recognition of valuation gain on remeasurement of its investment in Indian unit RKM Powergen, as well as a one-off reversal of provision for mine restoration and land reclamation by the cement business in China.
