Sunway confident of record profit this year

Sunway Holdings Bhd expects a record net profit this year, driven by new business and healthier margins from all its five core divisions, managing director Yau Kok Seng said.



These include construction, property development, trading and manufacturing, quarry and building materials.

The construction division, which has RM3 billion worth of jobs in hand, is bidding for more infrastructure and building projects worth RM16 billion in Malaysia, Abu Dhabi, India and Singapore.

"We hope to get minimum RM1 billion worth of new contracts this year, maintaining our order book at RM3 billion," he told reporters yesterday after a shareholders' meeting in Bandar Sunway, Selangor.

Sunway, controlled by founder Tan Sri Jeffrey Cheah, has prequalified for projects like the light rail transit (LRT) line extension in the Klang Valley, the new low-cost carrier terminal in Sepang and the Kelau dam, part of the Pahang-Selangor raw water transfer project.

Yau said Sunway's property development unit, SunwayMas Sdn Bhd, will launch five projects, including one in Singapore, from July to December this year worth RM600 million.

It has six projects worth RM1.1 billion and 182ha of undeveloped land with potential to generate a gross development value of RM3.3 billion.

"With new construction jobs, property launches and unbilled sales of RM515 million, and increasing trading, manufacturing and quarry activities, we hope to exceed last year's earnings," Yau said.

Sunway reported a strong first quarter net profit of RM40 million, which is 2.5 times higher than in the same quarter last year.

"We have very clear strategy on how we want to build our businesses. The geographic diversification has helped us grow all the divisions.

"To expand further, we will continue to recruit the right talent and manage the foreign exchange rates," he said.

Sunway, which has RM170 million in its reserves, has no immediate plans to do a rights issue, he said.

Yau said Sunway will manage its cash flow, generated from all its operations, to expand.

"We hope to come up with a consistent dividend policy from next year. We are looking to distribute 20 per cent of our profits to shareholders," he said.

By Business Times