KUALA LUMPUR, Dec 4: Construction player Fajarbaru Builder Group Bhd, which is bidding for the RM7.1 billion Gemas-Johor Baru electrified double-track train (EDTT) project, expects to get the tender results by the end of this month, according to its managing director Teo Sock Cheng.
“We have already submitted (the bidding for the contract). Hopefully by the end of this month we will get the results,” he told reporters after the company’s AGM here yesterday.
“We are positive (to get the jobs), based on our track record and experience,” he added.
A business weekly recently reported that the company was in talks with China Railway Construction Corp Ltd (CRCC) to jointly bag the project.
Teo declined to disclose further details, as it is awaiting the award of the contract.
Previously, the state public works and rural and regional development committee chairman Datuk Hasni Mohammad said the project will begin in March next year, which will include upgrading works on stations, and is expected to be completed in 2021.
The track, which measures 197 km, will start from JB Sentral to Kemas Baru, Kulai, Simpang Rengam, Layang-Layang, Kluang, Mengkibol, Kluang, Paloh, Bekok, Labis, Genung, Segamat and Gemas.
Meanwhile, Fajarbaru’s finance director Ooi Leng Chooi said the company, which is currently bidding for some RM6.2 billion worth of jobs, is eyeing double-digit growth in net profit for the financial year ending June 30, 2016 (FY16), mainly driven by its construction, as well as timber and logging business.
Ooi said he expects the timber and logging business to contribute about 60% to its bottom line for the current financial year (FY16), while the remainder will come from its construction business.
“It is possible that our timber business will become our major contributor (in FY16), but we will not change our core business, which is the construction division.”
“We will continue our tendering (for construction projects),” he added, explaining that its RM6.2 billion tender book includes building, infrastructure, light rail transit and railway projects.
At present, Ooi said the company has an unbilled order book of RM300 million, which will keep it busy for another two years.
On prospects, Ooi said despite the current soft market conditions, he remains positive on the construction industry.
He added that the company was not significantly affected by the ringgit depreciation, but more by the Goods and Services Tax implementation, which brought about higher raw material costs.
“We mostly use local raw materials, so the weakening of ringgit doesn’t affect us much,” he added.
For the first quarter ended Sept 30, 2015, Fajarbaru’s net profit jumped 152% to RM2.8 million, compared with RM1.11 million in the previous corresponding period, mainly due to higher revenue contribution from the logging and timber business.
Revenue was up 32.3% to RM109.4 million, from RM82.7 million previously.
— THE SUN