Vizione mulls paying dividends

This article first appeared in The Edge Financial Daily, on September 7, 2017.
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KUALA LUMPUR: Vizione Holdings Bhd is looking at the possibility of paying dividends to shareholders from as early as the next financial year ending May 31, 2019 (FY19), said its group managing director Datuk Ng Aun Hooi.

The last time it declared an interim dividend was for FY02 when it was still known as Astral Supreme Bhd.

Ng, a major shareholder of Vizione with a 5.66% stake, said a dividend payout is likely for FY19 after Vizione booked an aggregate net profit guarantee of RM82 million for FY17 and FY18, arising from its acquisition of Wira Syukur (M) Sdn Bhd for RM280 million.

“We will also recognise revenue on a progressive basis for our outstanding construction order book of RM3.6 billion,” he told reporters after Vizione’s extraordinary general meeting (EGM) yesterday.

However, Ng said no final decision had been made yet.

“Vizione will consider paying the dividends subject to its capability to do so, and after considering various factors such as earnings and cash flow,” he added.

Earlier at the EGM, Vizione received shareholders’ nod to acquire Wira Syukur, which will be satisfied via a combination of cash and issuance of new shares of Vizione to be issued at an issue price of 11 sen per share.

Ng currently owns a 51% stake in Wira Syukur, a privately held construction firm incorporated in 1996 which have completed projects worth more than RM800 million.

The remaining 32% and 17% stake in Wira Syukur are held by Bee Jian Ming and Goon Mong Yee respectively.

Vizione had, in a circular to its shareholders, said that it is still considering various options before arriving at the exact cash portion and number of new shares to be issued, so as to ensure that it will retain its 68% grip after the purchase is complete.

In conjunction with the purchase of Wira Syukur, Vizione is also planning to raise around RM186 million via a private placement exercise to selected investors, in which the cash proceeds will be used to fund its future construction and property development-related projects.

Ng said Vizione is in the process of identifying suitable investors that “share similar mindset and values” to place out the shares.

“Vizione welcomes pension firms and institutional funds [as investors], but in doing so, we need to grow our market capitalisation to the tune of RM1 billion in order to attract their interest,” Ng said, noting that post-acquisition of Wira Syukur, Vizione’s market capitalisation is expected to reach around RM400 million.

Going forward, Ng said Vizione expects its revenue to grow by at least 5% in FY18, while not discounting that it “may also double” that what it had booked the previous year of RM49.1 million.

Ng also said Vizione is tendering for some RM1.5 billion of construction projects as part of its continual effort to replenish its order book, and typically the success rate is 40% to 50%.

The group will also embark and explore some smaller scale property development project by working closely or joint venture with the landowners. “It is our intention to have diversified sources of income streams for the group,” said Ng.