UEM Edgenta Bhd is looking to strengthen its infrastructure solution division by participating in railway projects between Malaysia and Singapore.
Its newly-appointed MD and CEO Syahrunizam Samsudin said the firm will be participating in tenders for projects such as the Kuala Lumpur (KL)-Singapore high-speed rail (HSR) and the Johor Baru-Singapore Rapid Transit System (RTS) when the Malaysian government announces the projects’ work packages.
“Yes, (we will participate in the RTS and HSR) if the tenders are matched with our capabilities.
“We definitely will participate if the government announces anything moving forward. We have a team that already looks at the possibility of these projects,” he told reporters at a recent media briefing in KL.
In its financial year ended Dec 31, 2019 (FY19), the group’s infrastructure solution division, which consists of infrastructure services and asset consultancy, contributed 45% to its annual top line.
“In the past, we have done projects such as the light rapid transit (LRT) extensions that show our capability in railway projects, particularly in project management consultant (PMC) and system engineering,” Syahrunizam added.
The group’s asset consultancy service, Opus-AV Consortium, was appointed as PMC on March 20, 2009, by Prasarana Malaysia Bhd to undertake the full project management services of the LRT Line 2 extension.
In 2016, its wholly-owned subsidiary, Edgenta Propel Bhd, was awarded a contract from Ahmad Zaki Resources Bhd for the relocation of telecommunication works with the Sungai Buloh-Serdang-Putrajaya Mass Rapid Transit Line 2.
Last week, MyHSR Corp Sdn Bhd called for two tenders to procure consultant services to assist with regulatory submissions to the relevant authorities about the HSR.
In May, the Malaysian and Singaporean governments agreed to extend the deferment of the HSR until year-end to allow further negotiations on the proposed changes and to identify cost reduction options.
The HSR is an infrastructure railway project connecting KL to Singapore through a 350km high-speed train line, said to shorten the travel time between KL and the republic to 90 minutes. Both countries had also been on the same page for the RM10 billion RTS project, of which construction is expected to begin in early 2021.
The RTS is a four-km line connecting Bukit Chagar in Johor Baru and Woodlands in Singapore, aimed at easing traffic and alleviating congestion on the Causeway. The rail service is expected to accommodate 10,000 passengers per hour upon completion.
An impairment totalling RM50 million on unsold property inventories pushed UEM Edgenta into the red in its second quarter ended June 30, 2020 (2Q20), with the group reporting a net loss of RM26.91 million against earnings of RM34.36 million made last year.
Quarterly revenue declined 24.7% to RM448.47 million from RM595.42 million in 2Q19.
Nevertheless, Syahrunizam said the group remains confident on its balance sheet, with a gross gearing ratio of 0.33 times coupled with an orderbook of RM12.2 billion.
“In the first half ended June 30 (1H20), our Taiwan arm already won two contracts, even during this difficult period. We are looking at some opportunities through our healthcare support division in Singapore hospitals where we can continue to provide competitive services.
“I think the difference between the overseas market and Malaysia during the current environment is that some of the markets abroad are looking at managing costs differently where the government absorbs some of the cost, thus allowing them to fight on margin for competitiveness,” he said.
Though the situation will not return to pre-Covid-19 levels, 2H20 will see an improvement in terms of regaining some projects, he added.
Sumber: The Malaysian Reserve