News

News Release : Financial Highlights For UEM Builders

News Release
Kuala Lumpur
29 May 2008


FINANCIAL HIGHLIGHTS FOR UEM BUILDERS

UEM Builders Berhad today announced its results for the first quarter ended 31 March 2008.


Improvement in results

The Group recorded a profit before tax of RM38.4 million for the current quarter as compared to RM29.6 million in the previous year corresponding quarter. Included in the results is a foreign associate's profit of RM7.4 million as compared to a loss of RM13.0 million recorded in the previous year corresponding quarter.

The increase in profit is based on revenue of RM595.8 million for the first quarter of 2008 as compared to the previous year corresponding quarter of RM714.6 million. The lower revenue is mainly due to completion of the major domestic projects in the construction sector in 2007, primarily the Electrified Double Track Project from Rawang to Ipoh and PLUS Third Lane Widening Project from Seremban to Ayer Keroh whilst other new projects are in the start up phase and revenue from these projects have not yet come on stream. The remaining phases of PLUS Third Lane Widening from Rawang to Tanjong Malim are in progress and expected to be completed this year. The Penang Bridge widening works which commenced in 2007 is expected to contribute significantly to revenue growth in 2008.

UEM Builders' infrastructure maintenance and facilities management and toll concession divisions have continued to contribute consistent and positive earnings for the Group.


Headline Key Performance Indicator (KPI) targets

The Group has announced a revenue growth target of 40% for the year 2008. For the current quarter, the Group has achieved 17% of the total revenue targeted. In addition, the Group achieved an annualized Return on Equity (ROE) of 16% for the quarter. This is in line towards achieving the full year ROE of 20% previously announced as headline KPI.


Managing Director's statement

Dato' Ridza Abdoh Salleh, the Managing Director of UEM Builders Berhad giving his views on the results said that

"We are happy with the results and will strive to achieve our targets despite a challenging business environment where significant cost escalation in material prices has become the norm. We are implementing various measures to counter the impact of price volatility in construction materials and fuel; the most important being the inclusion of negotiated price escalation clauses in the construction contracts we enter into.

"Moving forward, the Group is positive that the Penang Second Crossing Bridge Project will be implemented as planned because of the importance of the project and its contribution to the Malaysian economy. We are pleased to report that progress of works on this project has been significant and the Group has incurred more than RM200 million to-date. Completed works include design, survey, soil investigation, pile testing and the construction of the Batu Kawan site office. Major progress in completing the works for detail design, site clearing, initial dredging, jetties, haulage and access roads and the casting yard plant for the construction of segmental box girders are in various advanced stages of completion. We are working with the various authorities to ensure the successful completion of this very important project. We also anticipate that significant Ninth Malaysia Plan infrastructure projects announced previously in the country will proceed as planned and the Group hopes to benefit from the construction as the projects are rolled out.

"The Group will continue to focus on overseas projects in India, Indonesia and Middle East. Recently, we have been successful in entering into a strategic alliance with an Indian based Developer to undertake the construction of their development projects in India. This venture will enable the Group to build on future growth and profitability.

"The contributions from the infrastructure maintenance and toll concession divisions continue to provide a stable income base to the Group."


ABOUT UEM BUILDERS

UEM Builders is the engineering and construction flagship for the UEM Group that undertakes various engineering and construction projects besides operating quarries, premix and ready-mixed concrete plants. The Group also provides infrastructure maintenance & facilities management services and is responsible for the management and operation of toll collection for the Penang Bridge. The Group's wide range of services are undertaken by the following subsidiaries and associate company:-

Engineering & Construction

· UEM Construction Sdn Bhd
· PATI Sdn Bhd
· UE Development India Pvt Ltd
· Intria Bina Sdn Bhd
· Enrich Front Sdn Bhd
· Costain Group PLC (a UK-based associate company)

Infrastructure Maintenance & Facilities Management

· Projek Penyelenggaraan Lebuhraya Berhad

Toll Concession

· Penang Bridge Sdn Bhd

The Group is at the forefront of the nation's infrastructure development. Among major projects undertaken are the North-South Expressway, North-South Expressway Central Link, Malaysia-Singapore Second Crossing, Kuala Lumpur Light Rail Transit System 2, National Sports Complex & Commonwealth Games Village, Kuala Lumpur International Airport Satellite Building and Electrified Double Track from Rawang to Ipoh.

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