Managing director and CEO Syahrunizam Samsudin said the company expects to fare better in the second half of the year on the back of improved top line performance in the first half.
However, there still are challenges in terms of pressure on the supply chain as well as inflation, among others, he said during a briefing for analysts and journalists on the company’s unaudited financial results for the first half (H1) of its current financial year (FY2022) today.
Syahrunizam said the company will focus on discussing its contractual obligations with its clients in order to try and pass on some of the costs.
Nonetheless, he said, UEM Edgenta is on track to achieve its “Edgenta of the Future 2025” (EoTF 2025) target of RM100 million in cost savings over the course of five years. The company has already reached 40% of its target.
Syahrunizam said that in 2021, the company recorded about RM27.5 million in cost savings and targets to save another RM12 million this year.
“We are in good shape as we continue to find ways to reduce our costs and not just in terms of staff rationalisation but a whole host of other costs such as corporate costs and direct costs. We will also ensure efficiency from process optimisation,” he said.
He said the company will continuously expand its footprint in high-growth markets including Singapore, Taiwan and the Middle East, to enable it to continue to build on innovation and technology.
The CEO said UEM Edgenta expects to secure and leverage on new partnerships in the near future, bringing its portfolio of sustainability programmes as well as digital and tech solutions to the market.
In the healthcare segment, chief financial officer Hillary Chua said that in order to recover the loss of Covid-19 business management revenue, the company will shift to a “replacement through maintenance” (RTM) business programme.
“In terms of revenue, I will not say that there will be a big impact on the healthcare segment but what is important is that we look at other businesses like RTM that will be able to support the healthcare business,” she said.
Chua added that moving into the second half, the RTM business should be able to cover the expected loss of revenue caused by the Covid-19 pandemic.
For the first six months, the company’s profits increased by 58% to RM20.27 million while revenue climbed by 14.16% to RM1.17 billion.
This showed a 14.2% increase in revenue year-on-year (y-o-y).
The normalised net profit grew 65.6% y-o-y from RM16.7 million in H1 2021 to RM27.6 million in H1 2022.
The company’s order book stands at RM10.5 billion thanks to new contracts acquired in H1.
UEM Edgenta said international markets and technology-enabled contracts continue to lead the way in the fight for new deals. Both combined, account for 70% of new contracts.