UEM Edgenta Declares Bumper Dividend On The Back Of Stronger Financial Performance For FY17

February 20, 2018 Press Release No Comments

KUALA LUMPUR, 20 February – UEM Edgenta Berhad (“UEM Edgenta” or “Company”) today announced its unaudited consolidated results for the year ended 31 December 2017 (“FY17”), as well as dividend declaration for FY17.

Highlights

  • Declared special dividend of 18 sen and 2nd interim dividend of 5 sen respectively, bringing the total dividend payout to 31 sen per share for FY17 when aggregated with 1st interim dividend paid in September 2017 of 8 sen.
  • This is the highest dividend payout by UEM Edgenta, following the disposal of Opus International Consultants Limited (“OIC”).
  • Achieved full-year PAT of RM434.8 million after taking into account a one-off gain on the disposal of UEM Edgenta’s entire 61.2% equity in OIC of RM274.9 million, which represents a 9.3x increase against FY16’s PAT of RM46.6 million.
  • The special dividend of 18 sen and 2nd interim dividend of 5 sen will be paid in April 2018 and May 2018

Q4 FY17 results

Revenue for Q4 FY17 increased by 28.5% or RM149.2 million, as compared to Q3 FY17 of RM523.1 million to RM672.3 million. This was mainly on the back of the Infra Services Division’s increased revenue of RM86.9 million from expressway works, and Consultancy Division’s higher contribution from design and project management support work of RM45.7 million. On a year-on-year basis, revenue for Q4 FY17 was 31.1% higher than the preceding year’s corresponding quarter of RM512.9 million. Profit Before Tax (“PBT”) was also higher year-on-year by 32.8% at RM75.4 million.

Full-year performance

Revenue for FY17 stood at RM2.1 billion, which is 34.3% higher than FY16’s revenue of RM1.6 billion. Healthcare Services and Infra Services Divisions continue to be the largest revenue drivers for the Company, contributing 43.0% and 40.7% of full-year revenue, respectively.

PBT for FY17 was RM172.9 million, which was marginally lower compared to the previous year’s PBT of RM181.5 million, due to non-operational items such as an increase in interest expense of RM25.6 million from the Murabahah Term Facility (arising from the acquisition of Asia Integrated Facility Solutions Pte Ltd (the holding company of UEMS Pte Ltd)) and issuance of Sukuk, as well as an increase in amortisation of intangible assets of RM19.3 million.

Taking into account a one-off gain on the disposal of the Company’s entire 61.2% equity in OIC of RM274.9 million which was completed on 4 December 2017, the Company recorded a full-year PAT of RM434.8 million. This represents a 9.3x increase against FY16’s PAT of RM46.6 million. PAT from continuing operations following the disposal of OIC stood at RM125.1 million for FY17.

As at end-2017, UEM Edgenta’s gross gearing reduced to 0.35x and the Company is in a net cash positive position of RM143.7 million as a result of the disposal of OIC and repayment of debt via proceeds received from the aforesaid disposal of RM463.0 million, which has put the Company’s balance sheet on solid footing.

Special dividend and 2nd interim dividend

On the back of the aforesaid disposal and profits generated during the year coupled with improvements in working capital management, UEM Edgenta has declared a special dividend of 18 sen and a 2nd interim dividend of 5 sen which when aggregated with the earlier interim dividend declared in August 2017, would bring the amount of dividend payout to 31 sen for FY17. This amount represents UEM Edgenta’s highest dividend payout, following the disposal of OIC. The special dividend of 18 sen and 2nd interim dividend of 5 sen will be paid in April 2018 and May 2018 respectively.

“The declaration of this special dividend and 2nd interim dividend is in line with our commitment to return excess cash from the disposal of OIC, and we will continue this commitment of rewarding our shareholders”, commented Dato’ Azmir Merican, Managing Director/Chief Executive Officer of UEM Edgenta.

Outlook 2018

Moving forward, in FY18, UEM Edgenta expects to continue to deliver strong dividend payout and return to shareholders.  This will be backed by its strong and stable earnings as well as growth in all of its business divisions.

Specifically, the Company expects organic revenue growth across all Divisions on top of the delivery of existing projects, such as the provision of hospital support services in the northern region of Peninsular Malaysia; housekeeping for the KK Women’s & Children’s Hospital and Khoo Teck Puat Hospital in Singapore; maintenance of the North South Expressway and East Coast Expressway 2; design and project management support for Pan Borneo Highway; and township management services for mixed developments in Iskandar Puteri Region, Johor as well as high performance green building project and integrated facilities management services for various clients. This will be complemented by improved cross-selling between the respective Divisions and the harnessing of technology to deploy innovative and holistic product offerings that meet market demands.

Operational excellence initiatives and thereon margin expansion will also be key for UEM Edgenta in FY18, so as to result in a stronger quality revenue base and profitability post-OIC disposal. The Company will continue to realise synergies from its acquisitions, and deploy technology-based enablers to its customers, as well as rolling out performance-based contracting.