KUALA LUMPUR (Nov 28): WCE Holdings Bhd narrowed its net loss by 41.5% to RM24.17 million in its second financial quarter ended Sep 30, 2023 (2QFY2024), from a loss of RM41.29 million a year earlier, as revenue nearly doubled from the completed sections of the West Coast Expressway (WCE) project and an absence of additional cost provisions recorded a year earlier.

The interest cost for this quarter was also lower at RM38.2 million compared with RM40 million in the preceding year.

Quarterly revenue soared 91% to RM230.51 million from RM120.66 million in 2QFY2023, mainly attributed to higher construction activities for the WCE project and higher toll revenue due to higher traffic volume recorded, particularly during school and festive holidays, the highway concessionaire said on Tuesday.

The WCE project involves the development of a 233km toll highway from Banting, Selangor to Taiping, Perak. The build-operate-transfer project has a concession period of up to 60 years effective from Dec 20, 2013.

Most recently, Section 6 of the WCE, connecting Bandar Bukit Raja Utara to Assam Jawa, commenced operations on Nov 21, slashing travel time to 15 minutes, from about 45 minutes previously.

For the first half of financial year 2024 (1HFY2024), WCE Holdings incurred a lower net loss of RM50.58 million compared with a net loss of RM55.42 million in the previous year, as revenue jumped 53.4% to RM346.55 million from RM225.87 million.

WCE Holdings said the group is expected to incur losses in the early years of toll operations due to the cessation of capitalisation of interest expenses for completed sections. Nonetheless, the group said it is still expecting a surplus from toll operations before accounting for this interest expense.

The toll project is divided into 11 sections, of which five sections — Section 5 (Bandar Bukit Raja - Kapar), Section 8 (Hutan Melintang - Teluk Intan), Section 9 (Kampung Lekir - Changkat Cermin), Section 10 (Changkat Cermin - Beruas) and most recently Section 6 (Bandar Bukit Raja Utara - Assam Jawa) — have been opened to traffic.

WCE Holdings is targeting to complete another three sections by March 31, 2024. These are Section 1 (Banting - South Klang Valley Expressway or SKVE); Section 2 (SKVE - Shah Alam Expressway or Kesas); and Section 11 (Beruas - Taiping South).

“The final three sections namely, Section 3 (Kesas - Federal Highway Route 2), Section 4 (Federal Highway Route 2 - New North South Klang Straits Bypass) and Section 7 (Assam Jawa - Tanjung Karang) are targeted for completion by 2025. Going forward, the additional sectional toll revenue is expected to further improve the future financial performance of the group in terms of cash flows and operating results,” the group added.

WCE Holdings’ shares inched up half a sen or 0.68% to close at 74.5 sen on Tuesday. This gives the group a market value of RM2.23 billion.