Delay of Pan Borneo Construction Will Not Impact UEM Edgenta Much
Even with a delayed timeline for the construction of the Pan Borneo Highway in Sabah, UEM Edgenta Bhd has clarified that this will not have any significant impact on the group as the project size is small in relation to its total earnings, said UEM Edgenta chief executive officer Datuk Azmir Merican.
UEM Edgenta's indirect wholly-owned unit, Opus International (M) Bhd secured a letter of award (LoA) from related party Borneo Highway PDP Sdn Bhd (BHP) in June to provide technical support services for the highway for RM60.3 million.
At a media briefing, Azmir mentioned that the Government's decision is beyond the company's control.
“We can't control what is happening with Pan Borneo but what you can see by contextualising the impact of Opus as that project value is actually not that material as far as our performance is concerned,” he explained.
This particular project falls under the group's asset consultancy segment, only 7%, or RM65.8 million, of the group's revenue during the first half of the financial year 2018.
Azmir emphasized that the project is immaterial to the company's earnings, due to this, UEM Edgenta will be able to make up for any possible losses from the contract.