Maybank Investment Bank Bhd (MIBB) in a report today (March 24) said Gamuda Bhd’s results were above expectations maintaining a “buy” call.
Gamuda Bhd (Gamuda) (29579-T), an engineering, property and infrastructure company based in Malaysia, reported that its quarter two financial year 2023 brought the first half core profit after tax and minority interest to RM 385 million (+17% year-over-year); the latter at 54%/55% of house/street’s full-year forecasts.
“The beat, relative to our forecast, was due to stronger overseas contribution, mainly coming from the SMW-WT (Australia) project. We raise financial year 2023E profit after tax and minority interest by 8%; unchanged for financial year 2024 to 2025E. Our revised net asset value-transfer price is consequently raised to RM 4.60 (+15 sen),” said Maybank.
Quarter two financial year 2023 engineering and construction profit before tax (pre financial reporting standard 11) rose 35% quarter-over-quarter as revenue more than doubled (+114% quarter-over-quarter) on strong pick up in the pace of its Australia projects.
“The SMW-WT project, in particular, has reached 15% financial completion as of end-quarter two financial year 2023, ahead of our forecast for 20% completion by end-financial year 2023,” Maybank added.
Quarter two financial year 2023 property profit before tax (pre financial reporting standard 11) also held up well (+4% quarter-over-quarter) after record pre-sales in financial year 2022. In line with management’s plans, overseas contribution grew, making up 43% of group turnover in the first half of financial year 2023 (first half of financial year 2022: 16%) and 38% of group net profit (first half of financial year 2022: 18%), filling the void left by its tolled highway operations, after they were sold in Oct 2022.
Outstanding engineering and construction order book was RM 14.5 billion (17% domestic, 83% overseas) end-Jan 2023, and RM 20.5 billion if including DT Infrastructure Pty Ltd’s order book post-acquisition of a civil construction business in Australia, expected to complete in mid-2023.
Quarter two financial year 2023 property pre-sales were RM 520 million, bringing first-half pre-sales to RM 1 billion.
Unbilled property sales remained at a high RM 5.4 billion as at end-Jan 2023, while the internal target is still RM 4.5 billion property pre-sales in financial year 2023.
Gamuda (in a consortium) submitted its tender for Package CMC 303 of the KVMRT3. The consortium’s bid for CMC 303 is believed to be worth RM 13.3 billion. Meanwhile, Gamuda is also eyeing the KVMRT3 system works which could be worth at least RM 5 billion.
