KUALA LUMPUR (July 26): Kejuruteraan Asastera Bhd (KAB) expects to see revenue growth in current financial year ending Dec 31, 2019 (FY19), as the electrical engineering specialist looks to include mechanical engineering and energy efficiency (EE) solutions as new revenue streams for the company.
KAB managing director Datuk Lai Keng Onn said today the group also plans to expand its operations into other states in Malaysia, as the company's contracts are mostly concentrated in the Klang Valley.
"We will be making announcements in the coming quarter, and our orderbook and revenue will continue to grow. We are confident of growth but we cannot commit to a figure yet," he told reporters when asked about the quantum of growth expected.
Lai said this at a press conference in conjunction with KAB's investors' briefing here today.
"We are still looking at expanding to Johor. We previously had plans to set up an office in Johor Bahru when we had our IPO (initial public offering) in 2017, but we held back from expanding there as the property market there seemed to be slowing down. We are still considering now," he said.
The group is also looking at expanding to Penang and Melaka, said Lai.
Lai said KAB relies on its electrical engineering division, which accounts for more than 90% of its revenue. He said the core business is doing well, given the group's orderbook of RM297 million as at March this year.
KAB's quarterly financial report shows that 1QFY19 net profit rose to RM2.37 million from RM2.36 million a year earlier. Revenue was, however, lower at RM31.07 million compared to RM32.8 million a year ago.
At the press conference today, Lai said that with the addition of new revenue streams in the near future, he expects the group to see better performance ahead.
He said the group had only recently commenced operations under its mechanical engineering division, which includes work related to centralised air conditioning for buildings such as shopping malls.
Meanwhile, the group is also going into EE solutions and is currently in talks with a company that operates a chain of food and beverage outlets.
Lai said this involves installation of sensors and provision of software for KAB's clients to monitor and collect data on the operation of the air conditioning system in a particular building. He said the data is then used to make adjustments to the usage of the systems to achieve greater efficiency and cost savings.
At Bursa Malaysia today, KAB's share price rose one sen or 4.76% to 22 sen at 3:01pm. The stock saw 1.52 million shares traded.