Right now, the RTS project faces prolongation costs - expected to be completed in 2024 but delayed to 2026. Dunno whether Gadang can claim these costs or not.
gadang at least start positive and making money for 2 QR, much better than other construction counter , as long as making profit , sharing price will sustain
Data Centre here, Data Centre there. Data Centres are booming in Malaysia. Gadang got 280 million contract to build a Data Centre in Cyberjaya from TM.
Gadang is in hot soup as EPU is throwing the spanner in the works for it's prime jewel property development - Kwasa Damansara land purchase deal. Chances are - they need to satisfy the 30% Bumi requirement meaning lesser profit for its property division.
announced data centre contract but muted price movement... in fact, looking at the chart, price peaked before the announcement... 😑 see retail investors see the news already too late.. sigh.
Good QTR results ?! Don't make me laugh leh...construction division is still making losses. Profit is attributable to interest income arising from Receivables. But whether the receivables can convert to cash is questionable.
Good QTR results ?! Don't make me laugh leh...construction division is still making losses. Profit is attributable to interest income arising from Receivables. Higher interest implies longer aging. Longer aged receivables implies higher risk of collectables. Whether the receivables can convert to cash is questionable.
Interesting observation...but why the construction division still showing losses ?
By right, this RTS project should be driving the construction division revenue as it forms the bulk of the order book. Based on press release, this RTS project is supposed to be completed by middle of 2024. I expect contributions / progress billings from this project to be in the advanced stage already. But why the construction division still showing losses ?
Completing the project is one thing..but to do it profitably is another thing.
Every quarter, Gadang attributes the losses from its construction division to costs overrun such as labor and material costs. It seems to me these are external factors that Gadang cannot control. Yet, Gadang is still unable to claim from the principal.
I will only load up on Gadang comes next quarter results based on the performance of the construction division. Should its construction division is showing profit, then we are talking about a very different Gadang.
Yesterday, inside IJM quarterly result - the construction division is still showing losses - albeit a small loss of a few millions...that got me thinking. If the big boy like IJM who have a stronger bargaining power than Gadang - can still show a loss due to rising material costs and inflationary factors - then Gadang next quarter results for their construction should not look too great. Its losses may narrow down but don't expect it to turn the corner - just yet.
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kancs3118
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Posted by kancs3118 > 2024-01-31 06:35 | Report Abuse
Right now, the RTS project faces prolongation costs - expected to be completed in 2024 but delayed to 2026. Dunno whether Gadang can claim these costs or not.