KUALA LUMPUR: Gadang Holdings Bhd reported a net loss of RM27.70 million for the fourth quarter (Q4) that ended May 31, 2023 (FY23), up from a net loss of RM4.02 million a year ago.
The company's revenue decreased by 18 per cent to RM113.95 million from RM138.17 million in the previous year.
In a Bursa Malaysia filing, the company said the drop in revenue was primarily due to a one-off impairment loss on goodwill in Indonesian subsidiaries and impairment of concession assets, investment in a joint venture, receivables and contract assets.
The company said the decline in revenue is also attributed to the provision for potential liability arising from liquidated ascertained damages (LAD) caused by delays and prolonged costs to finish off existing construction projects.
In the cumulative period, the company reported a net loss of RM29.32 million against a net profit of RM41.65 million from the previous year.
Revenue decreased by 24 per cent to RM496.07 million from RM651.99 million a year ago.
Gadang Holdings cited lower contributions from construction projects after prolonged completion costs due to Covid-19-related disruptions.
The company also attributed the drop in revenue to a one-off impairment loss on goodwill in Singapore and Indonesia subsidiaries and impairment of concession assets, investment in joint ventures, receivables, and contract assets.
This also includes the provision for potential liability derived from LAD due to delays and prolongation costs to complete existing construction projects and the gain in non-recurring transactions and disposal of development lands in the preceding year.
Moving forward, the company's construction division's performance will be underpinned by its outstanding order book of RM1.18 billion.
The division will continue to bid on construction projects to replenish its current order book.
The property division will continue to focus on developing mid-range priced residential projects across its development portfolio for the financial year ending 2024 to meet market demand.
As of May 31, 2023, the property division had recorded RM187.85 million in unbilled sales.
"The utility division continues to contribute recurring revenue streams from the concession water treatment plants plus a further contribution from mini-hydropower plants expected to be fully commissioned by the first quarter of the financial year 2024," the filing said.
The construction of the 5.9 MWac solar photovoltaic energy generating facility located in Tawau, Sabah, is in progress, and this will further strengthen revenue contribution to the company in the second half of 2024.