Gamuda Berhad’s fourth-quarter core net profit soared +23% to RM253.5 million, driven by stronger earnings contributions from both its construction and property divisions. For the entire FY22, core earnings came in +38.1% higher at RM805.8m, beating expectations of MIDF analysts and the street.
The group’s construction division posted a PBT of RM389.5m in FY22, which was an increase of +14.3% over FY21, despite a marginal increase of only +0.15% in its revenue to RM3.29b. The improved earnings were attributable to the cost savings from MRT2, which is currently at 94% completion stage. Management is projecting a construction revenue of RM5b in FY23, with some 90% of its current outstanding order book. Excluding inter-segment revenue, we would expect it to be RM4.6b. Management also guided that construction revenue in FY24 and FY25 could hit RM8b and RM9b respectively
Banking on its vast experience from MRT1 and MRT2, we expect Gamuda and its partner MMC to be able to secure package CMC303 of the upcoming MRT3, the package with the longest underground works, expected to be about 10km plus 6km of elevated works. MIDF has previously estimated the size of CMC303 to be about RM14.29b. Management is equally optimistic about their chances to clinch the project. The deadline for the tender submission for CMC302 and CMC303 is today and expect the packages to be awarded by November. Should Gamuda-MMC partnership win the tender, this would keep Gamuda busy for the next eight years. Assuming a conservative profit margin of about 6%, Gamuda’s share of the MRT3 earnings would be about RM428.7m.
In this sense, MIDF is making some revisions to its FY23-FY24 estimates and has introduced its estimates for FY25. The research house is revising its forecast higher by +16.7% for 2023 and +6.6% for 2024 to RM813.9m and RM773.2m on the
back stellar construction earnings from its bulging order book and strong property sales expected.
