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Property News

Construction industry to recover despite rising raw material prices

Kerjaya Prospek Group has declared a fourth interim single-tier dividend of 2 sen per share for the financial year ended Dec 31, 2023, payable on April 5, 2024.

PETALING JAYA: Kerjaya Prospek Group Bhd remained optimistic about the construction industry’s post-Covid-19 pandemic growth, despite facing challenges such as increased raw material prices.

Non-independent non-executive chairman Tee Eng Ho expressed confidence that construction projects could now progress more swiftly as the situation gradually improves.

“Furthermore, the labour shortage is no longer a concern with the inflow of foreign labour, but we are not planning to add more workers for now,” he told reporters when asked about the current industry outlook during Kerjaya Prospek’s results briefing here today.

He added that the company currently has a total workforce of 7,000, including 3,000 subcontractors.

Tee also announced the company’s plans to pursue new opportunities with Samsung C&T Corporation via a consortium company, Samsung-KP JV.

The JV company is expected to focus on factory construction in Malaysia and opportunities in the Andaman Island development project in Penang, estimated to be worth about RM2 billion.

In a filing with Bursa Malaysia today, Kerjaya Prospek posted a 15.2% higher net profit of RM132.29 million for the financial year ended Dec 31, 2023 (FY2023) from RM114.79 million in FY2022.

Revenue increased 30.2% to RM1.46 billion in FY2023 from RM1.12 billion a year ago.

The group said the increase in revenue was driven by higher revenue recognition from the substantial improvement in its property development and construction segments.

During the fourth quarter of 2023 (Q4 2023), the company’s net profit soared 25% to RM35.74 million from RM28.6 million in Q4 2022, with revenue surging 74.1% to RM489.04 million from RM285.26 million previously.

“This increase was fuelled by enhanced revenue recognition from the construction segment and contributions from the property development segment, namely The Vue @ Monterez project which amounted to RM10.6 million in Q4 2023,” it said.

Looking ahead, Kerjaya Prospek said it anticipates continued support from its outstanding order book of RM4.2 billion for construction contracts as of Dec 31, 2023, with a focus on consolidating its construction segment as the primary revenue driver.

Additionally, it said the company aims to bolster its manufacturing segment to complement its core construction business.

Meanwhile, group CEO and executive director Tee Eng Tiong highlighted the upcoming launch of Papyrus @ North Kiara by the first half of 2024, with an estimated gross development value of RM500 million and expected to boost the revenue of the group property development division.

In line with its commitment to shareholders, the company declared a fourth interim single-tier dividend of 2 sen per share for the financial year ended Dec 31, 2023, payable on April 5, 2024.

The total dividend declared for 2023 amounts to 8 sen per share, a payout totalling RM100.9 million.

At the close of trading, Kerjaya Prospek’s share price was up by 6 sen or 3.57% at RM1.74, giving it a market capitalisation of RM2.20 billion.

Source: FMT News

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