The value of projects in hand for Sarawak-based infrastructure company Hock Seng Lee Bhd (HSL) remains at a historical high of RM3.3 billion, while its net profit before tax is at RM40.57 million on the back of revenue of RM322.1 million for the first half of 2019.
This represents increases of nine per cent and 13 per cent respectively when compared with the first half of 2018 when net profit before tax stood at RM37.39 million on the back of revenue at RM286.00 million.
The company’s second-quarter results for the three months ended June 30, 2019, saw pre-tax earnings at RM21.81 million on the back of revenue of RM175.41 million.
This is an increase from the strong results of the second quarter of 2018. For the period ended June 30, 2018, pre-tax earnings were at RM18.85 million on the back of revenue of RM154.25 million.
“Earlier this week, we successfully bagged the RM104.51 million Jalan Sg. Bidut/Kpg. Tutus/Kpg. Sebedil/Kpg. Bungan Kecil, Sibu Division, roadworks contract from the State Government of Sarawak.
“This is on top of the Batang Paloh Bridge Project (Package 3 of Coastal Road Project) worth RM299 million secured in April 2019 and several smaller sized projects for buildings and bridge construction in Sibu which have now added a total of RM605.50 million worth of new projects to our books thus far in 2019,” said HSL managing director Datuk Paul Yu Chee Hoe.
“We are very pleased to utilize our marine engineering expertise and a large fleet of specialized equipment to undertake another significant roadworks project in Sarawak,” he added, referring to the newly procured contract in Sibu Division.
The project is part of the RM6.05 billion allocated for rural development by the Sarawak government and will enable a better access route for several villages strung along the low-lying riverine terrain beside the Igan River.
The scope of works includes piling, earth and sand filling, geotechnical works, drainage and road pavement.
“This new project has tipped the value of projects in hand over the RM3.2 billion mark to RM3.3 billion, of which some RM2.5 billion is unbilled,” said Dato Paul Yu.
These projects will keep HSL well occupied for several years, although selective procurement is ongoing.
“We are seeing the effects of vibrant development in Sarawak and the impact this has on the local construction industry.
“With our new projects and mega-projects progressing well, we are confident of further positive contributions to the earnings and net assets of the group,” Yu added.
HSL’s ongoing mega projects include Package 7 of the Pan-Borneo Highway contract and centralized sewerage works (tunnelling) projects in Kuching and Miri, Sarawak.
Given the strong financial results coupled with bidding successes and a record order book, HSL’s Board of Directors has declared a first interim single-tier tax-exempt dividend of 1 sen per ordinary share for 2019, payable to shareholders on October 10, 2019.
The dividend entitlement date shall be September 19, 2019.
The Group has also welcomed two new independent directors, Datu Sr. Sudarsono Osman and Datu Laura Lee Ngien Hion. These appointments bring further strength and depth to the existing Board and are In line with corporate governance best practices and the national development agenda. Both come with vast experience and are highly regarded in their respective profession.