This article first appeared in The Edge Financial Daily on July 26, 2018

KUALA LUMPUR: Gadang Holdings Bhd posted a 21.7% drop in net profit to RM23.27 million in the fourth financial quarter ended May 31, 2018 (4QFY18) from RM29.73 million a year ago, on poorer construction earnings, mitigated by stronger property profits.

Quarterly revenue rose 4.1% to RM182.01 million, from RM174.85 million in 4QFY17, on continuing progress of its construction projects, including those related to the refinery and petrochemical integrated development project in Pengerang, Johor, second line of the Klang Valley mass rapid transit, Tun Razak Exchange and Cyberjaya Hospital.

For the full FY18, Gadang’s net profit dropped 5% to RM95.12 million, from RM100.12 million in FY17, amid higher revenue of RM594.29 million, against RM553.87 million previously.

The group also proposed a first and final dividend of three sen per share for FY18, subject to shareholders’ approval at the forthcoming annual general meeting.

Looking ahead, Gadang said its construction order book of RM1.51 billion is expected to provide good income visibility and a stable earnings stream in FY19.

As for the property division, Gadang said it will initiate more aggressive marketing programmes given the overall weakness, which has impacted sales.

“With unbilled sales of some RM100.8 million, and planned new launches, the property division is expected to maintain a satisfactory performance in the coming financial year,” it said.