PETALING JAYA: Energy infrastructure solutions group Wah Seong Corporation Bhd’s net profit for the financial period ended March 31, 2023 (Q1 FY2023) has more than tripled (341%) to RM21.76 million from RM4.94 million in the same quarter last year.
Its revenue, meanwhile, rose 39% to RM639.67 million compared to RM458.83 million in Q1 FY2022.
The astoundingly positive performance coincided with improvements in the company’s multiple business segments.
The energy solutions services segment registered the highest external revenue compared to others, rising 40% year-on-year (y-o-y) to RM372.7 million in Q1 FY2023 compared to RM266.4 million in Q1 FY2022.
The segment also registered an 89% y-o-y increase in profit before tax (PBT) to RM28 million in Q1 FY2023 from RM3 million in Q1 FY2022.
In a filing with Bursa Malaysia, the group said the segment registered an impressive growth as project executions had increased on the back of a strong order book in Q1 FY2023.
Wah Seong’s two other segments – renewable energy and industrial trading and services – also recorded positive developments in the same quarter.
The renewable energy segment’s external revenue rose 22% y-o-y to RM109.7 million in Q1 FY2023 from RM90 million in Q1 FY2022 while its PBT was up by 27% y-o-y to RM11.6 million compared to RM9.1 million throughout the same period.
The company attributed the renewable energy segment’s growth due to higher number of projects executed by the industrial engineering unit and better profit margin from after-sales services recognised by the agro-based industrial unit.
Meanwhile, the industrial trading and services segment posted a 38% higher external revenue y-o-y of RM113.2 million compared to RM81.3 million, while its PBT rose 137% y-o-y to RM10.2 million from RM4.3 million.
“This was due to higher sales volume in building materials and recognition of the gain on disposal of assets held for sales,” its filing read.
No dividend was declared for this financial quarter.
Positive 2023 outlook
Wah Seong expressed strong confidence that the group’s trajectory will remain positive in the coming years.
“The increase in operational profit was contributed by an increase in revenue in the current quarter, as the group continues to execute projects from its existing strong order book,” it said in the filing.
In comparison with Q1 FY2022, Wah Seong’s PBT has more than doubled to RM50 million from a loss before tax of RM40.6 million in the previous quarter.
Furthermore, its order book has increased to RM3.5 billion, which comprises RM3.1 billion in the energy solutions services segment, RM426 million in the renewable energy segment, and RM54.9 million in the industrial trading and services segment.
“The strong order book is expected to contribute positive results to the group in the coming years,” it added.
On April 28, Wah Seong managing director and group CEO Chan Cheu Leong had announced his retirement from both positions after helming the company for 21 years.
He would be redesignated as a non-independent non-executive director of the company following his retirement.
Chan will be succeeded by Gian Carlo Maccagno come July 1.
Wah Seong is 40%-controlled by the Tan family of Tan & Tan Developments Bhd and IGB Corporation Bhd.
At noon, the group’s share price was up 2 sen or 1.75% at 87 sen, giving it a market capitalisation of RM678.03 million.