Advancecon’s 30%-owned associate bags RM153.5m earthworks project in Bintulu, Sarawak
KUALA LUMPUR (March 1): Earthworks and civil engineering services specialist Advancecon Holdings Bhd said it 30%-owned Advancecon Sarawak Sdn Bhd had bagged its single-largest contract worth RM153.5 million to undertake earthworks in the Samalaju Industrial Park, Bintulu, Sarawak.
The contract was awarded by Wenan Steel (Malaysia) Sdn Bhd to Advancecon Sarawak. Wenan is building an iron and steel production complex there.
In a statement today, Advancecon said the contract is in addition to the group’s ongoing works in Sarawak, namely two packages for Pan Borneo Highway Sarawak and two roadwork contracts from the Upper Rajang Development Agency (URDA).
With this, works in Sarawak now make up more than one-third of the group’s enlarged order book of RM863.5 million, which will provide the group with earnings visibility for a minimum of 34 months.
“Our strategy has always been to target and support high-growth areas. This substantive contract win further enhances our profile in Sarawak and positions us strategically to capture more opportunities in East Malaysia. This would also bolster our track record into undertaking earthworks for large-scale industrial properties, in addition to our core expertise for infrastructure and residential townships.
With no land possession and utility relocation issues, this particular earthworks project will utilise our fleet of machinery more efficiently than typical highway or roadwork projects. Thus, we foresee an increase in the utilisation rate which enhances our ability to record stronger profitability,” said Advancecon group chief executive officer (CEO) Datuk Phum Ang Kia.
With this new contract, he said Advancecon had secured RM214.1 million in new contract wins for the current financial year, surpassing the previous year’s total.
The project is expected to last 12 months from March 15 this year to March 14, 2022.
The Wenan steel manufacturing facility will be the largest steel manufacturing plant in Southeast Asia once completed, said Advancecon, and is projected to have a production capacity of 10 million tonnes per annum.
At the noon market break, shares in Advancecon settled one sen or 2.63% higher at 39 sen, giving it a market capitalisation of RM152.53 million. – Source: The Edge