PROTASCO MAKES PROVISION FOR IMPAIRMENTS, POSTS OPERATIONAL PROFIT IN FY2018
KAJANG, 27 FEBRUARY 2019: PROTASCO Bhd posted an operational profit of RM27.4 million for the year ended 31 Dec 2018, which after making several one-off provisions in the fourth quarter, has resulted in a full year net loss of RM37.03 million.
The group made provisions totalling RM41.6 million including RM23.1 million for cost overruns in certain completed projects. This resulted in a pre-tax loss of RM23.8 million, compared to a profit of RM70.3 million in 2017, said the engineering, maintenance and construction group in its announcement to Bursa Malaysia.
“We decided it would be prudent to take the necessary measures and took the initiative to make provisions and impairments for our construction portfolio assets to remove potential overhang,” said Dato’ Sri Ir Chong Ket Pen, Executive Vice Chairman and Group Managing Director.
“We do expect to be able to recover a substantial portion of these provisions in the future,” he added.
“Protasco continues to generate operational profit despite the current tougher operating environment,” he said. “Further, with the right sizing exercise, which started in the third quarter of 2018, Protasco is expected to yield positive results in 2019.”
The group’s operational performance was driven mainly by two segments – its Maintenance segment which saw a pre-tax profit of RM39.4 million in 2018, against RM56.5 million in 2017, and its Trading segment which posted a pre-tax profit of RM3.4 million in 2018, against RM3.9 million in 2017.
The group’s Engineering segment also remained profitable, posting a lower profit of RM3.8 million against RM13.7 million in 2017 which included a one-off contribution from the Pan Borneo highway project.
“We expect the Maintenance segment to remain as the group’s main revenue contributor, and we continue to pursue other opportunities in the maintenance and construction segments. Barring unforeseen circumstances, Protasco is expected to return to profitability in 2019,” Chong said.
About Protasco Berhad
Protasco Berhad is the country’s leading expert in Road Construction and Maintenance as well as in Engineering Services & Consultancy. Listed on Bursa Malaysia on 8 August 2003, Protasco Berhad is also involved in Property Development & Construction, Education & Training and Trading of Construction Materials. Protasco Berhad strongly believes balanced development and growth would propel the organisation forward. Protasco Berhad seeks to engineer appropriate infrastructure solutions, which contributes towards a better quality of life. With extensive international alliances, Protasco has the capability to harness technology and knowledge guided by a set of core values inherent in Protasco. In April 2016, Protasco Berhad was ranked among the top five by RHB Research in its annual listing of Top Malaysia Small Cap Companies.