Gamuda Ends FY21 on a Bright Note, Owing to Improved Construction and Real Estate Earnings

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Gamuda Bhd earned RM214.08 million in the fourth quarter ended July 31, 2021 (4QFY21), compared to a loss of RM12.52 million a year earlier.

The increase in quarterly earnings was attributed to improved construction and property earnings, as well as the absence of last year’s one-off non-cash industrialised building system (IBS) assets impairment of RM148.1 million, Gamuda said in a filing with Bursa Malaysia.

As a result, it earned 8.52 sen per share in 4QFY21, compared to a loss of 0.5 sen per share in 4QFY20.

Quarterly revenue, on the other hand, decreased by 4.3 percent year on year (y-o-y) to RM886.67 million in 4QFY21 from RM926.52 million in the previous quarter.

Quarter-on-quarter (q-o-q), its net profit increased 50.94 percent to RM141.83 million from RM141.83 million in 3QFY21, owing to higher construction and property earnings. However, revenue decreased 8.7 percent year on year to RM971.18 million.

For the full fiscal year (FY21), its net profit increased 56.26 percent year on year to RM588.31 million from RM376.5 million in FY20, despite a 3.98 percent drop in 12-month revenue to RM3.52 billion from RM3.66 billion earlier.

Gamuda stated that its chances have improved in the future, however recovery will likely remain difficult and contingent on the implementation of public health initiatives and policies aimed at containing the Delta form.

“While stimulus for infrastructure development is restrained by increased government fiscal burdens, the government’s resuscitation of public-private partnerships (PPP3.0) may provide some momentum,” it added.

Next year’s success is expected to be driven by global and domestic property purchases, as well as the continuous completion of the MRT Putrajaya Line (formerly called the MRT Line 2).

Additionally, it stated that the group’s resilience will be bolstered by its RM4.5 billion construction order book and RM4.6 billion in unbilled property sales, which will take it through the next two years.

Additionally, the group maintains a strong balance sheet, with a gearing ratio of 0.2 times and a strong cash position.

Gamuda’s shares closed two sen lower, or 0.66 percent, at RM3.02, valuing the firm at RM7.59 billion. The stock has declined 19 percent year to date from RM3.73 on January 4, 2021.

Published by Zack Baharum

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