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Gabungan AQRS' first quarter earnings soar to RM16.14mil

MAY 23, 2017, The Star
Gabungan AQRS Bhd quadrupled its net profit to RM16.14mil for its first quarter ended March 31, driven by higher contributions from its construction and property divisions as well as from land sales. 

Revenue for the quarter doubled to RM158.94mil compared with the same period last year. 

The company said that its construction division reported a revenue of RM61.9mil compared with RM58.8mil previously, while pretax profit from this division rose to RM8.6mil as compared to a loss of RM2.1mil previously. 

The increased revenue came from progress work for the Sungai Besi–Ulu Kelang Highway, PR1MA Homes in Kuala Kuantan, Pahang, and Pusat Pentadbiran Sultan Ahmad Shah. 

It also said that the higher pre-tax profit was mainly due to improved operating margins from the ongoing projects. 

Meanwhile, revenue and pre-tax profit from the property development segment was mainly due to the sale of two pieces of land held under development, as well as sales from Courtyard Villas, 'The Contours', which further improved the contributions. 

Speaking at Gabungan's seventh AGM yesterday, group CEO Datuk Azizan Jaafar said the group is looking to focus on earnings growth and achieve an orderbook replenishment target of an estimated RM700mil to RM800mil. 

"In the last 12 months, we have managed to secure contracts amounting to RM1.7bil. 

"Going forward, we will focus on executing these projects well. 

"Based on forecasts by research houses, Gabungan's net profit is expected to be on the high side of the industry average. 

"If we can deliver that in 2017, then 2018 will certainly be a better year," he said, adding that the group hopes to deliver positive results for projects to be tendered for, like the LRT3 project and the East Coast Rail Link. 

Azizan explained that Gabungan is a stronger company today, having turned around last year, in addition to a group-wide reorganisation as well as reductions in overheads and financing charges. 

Gabungan has yet to establish a dividend policy, though the board has indicated that they will deliberate on setting a dividend policy in the third quarter of the year. 

"We will take a look at our cashflows before deciding to declare dividends. 

"All signs are in the positive for good dividends, though we would like to utilise our funds to optimise growth for the company first," said Azizan. 

Gabungan closed 1.4% higher at RM1.44, traded on a volume of 4.45 million shares. Year-to-date, the stock is up 59%.