KUALA LUMPUR (March 1): Asset management and infrastructure solutions company UEM Edgenta Bhd is looking to build resilience in its international markets, where it believes its healthcare support services business could have a “bigger play”.
In 2020, 60% of the new contracts it secured came from abroad, while new domestic contracts made up the remaining 40%.
The company has identified two potential partners in Saudi Arabia for its healthcare support services business, UEM Edgenta's managing director/chief executive officer Syahrunizam Samsudin told a virtual press conference today.
Meanwhile, UEM Edgenta’s future technology offerings in the Malaysian integrated facilities management (IFM) sector will be designed based on proven solutions the company has already implemented in its healthcare support businesses operating in Singapore and Taiwan, said Syahrunizam.
He said the company is aiming to secure partnerships with reputable local IFM players in the healthcare industry.
In this region, the company is currently active in Dubai, through Operon Middle East — a subsidiary of its property and facility solutions division.
“There is a larger market in Saudi in terms of outsourcing of services in hospital management, and we think it is the right market for us to evaluate and to build a future potential business there,” said Syahrunizam. “All the indicators look positive for us in terms of partnering and entering into tenders in Saudi,” he added.
UEM Edgenta secured RM900 million worth of new contracts for the financial year ended Dec 31, 2020 under its healthcare support commercial business, representing 65% of all new contracts won that year.
Moving forward, Syahrunizam said UEM Edgenta wants digitalisation to be its new core focus, by way of enabling digitalisation of all aspects of its business through Cloud and SaaS (Software as a Service), and to be able to extract value from core and expanding market reach.
He said this while he unveiled the company’s ‘Edgenta of the Future 2025’ vision (EoTF25), which outlines its aspirations to position UEM Edgenta as a technology-enabled solutions company with a focus on healthcare.
“In terms of dependency, we are trying to focus more on healthcare business and changing the mindset of how we move with technology,” said Syahrunizam.
On top of this, Syahrunizam said the company is targeting RM100 million worth of savings over five years through cuts in operation costs, which shall be achieved through automation and mechanisation of its operations and processes.
For 2021, the company has allocated RM80 million as capital expenditure, half of which will be for the company's business digitalisation ambition, he said. "We will be moving away from conventional business and building software and platform for management," he said.
The company also plans to launch QuickMed, a digital solution for hospital data management and appointment system, later this year, he said.
Meanwhile, on its infrastructure business, Syahrunizam said the company’s thrust into East Malaysia and Kalimantan will lead UEM Edgenta’s regional expansion, with Opus Consultants providing an existing beachhead through its involvement in the Sarawak Coastal and Second Trunk Road Project.
He noted that the company will participate in future infrastructure works available in this market, as well as explore opportunities in Peninsular Malaysia’s highways and road infrastructure segment.
However, as the infrastructure segment is undergoing a “sunset low growth trajectory” as compared with the healthcare segment, Syahrunizam said UEM Edgenta will be “always be moving towards a higher growth industry”.
“We have had successes in 2020 in building a much more resilient commercial business, [so] we are basically focusing on efforts to continue that trajectory. Not forgetting that we have a large envelope of infrastructure projects to still deliver,” he added.
UEM Edgenta's order book currently stands at RM12.2 billion, of which RM1.4 billion worth of new orders were secured in 2020.
At the time of writing, UEM Edgenta shares were three sen or 1.78% higher at RM1.72, valuing it at RM1.43 billion.