Wednesday, Oct 29, 2003
MARC has upgraded the rating of WCT Engineering Berhad’s (WCT) RM120.0 million 5% Redeemable Unsecured Bonds with detachable warrants (2000/2005) from A-(s) to A(s), based upon the strengthening financial profile of WCT, underpinned by the strong performance of its civil engineering/construction and property development divisions. The rating continues to be supported by a RM15 million irrevocable banking facility secured from Maybank for the purpose of meeting any temporary shortfall of payment into the sinking fund.
During the period under review, WCT changed its financial year end from 31 January to 31 December. Despite the shorter operating period, WCT’s revenue continued its upward trend reaching RM704.45 million from RM473.86 million for the year ended 31 January 2002. WCT’s revenue growth stems mainly from new contracts secured by its civil engineering and construction division as well as its property development activities. In the domestic market, WCT secured a total of RM411 million worth of new contracts in 2002 and 2003 which included Packages 1A and 1B of the Bakun Hydroelectric Project Package CW2. WCT’s overseas portfolio; accounting for around 30% of the group’s order book; also grew with the addition of two projects in Bahrain, namely the RM584 million Bahrain Formula One Racing Circuit project and the RM100 million flyover road at Seef, a shopping district in Bahrain of which WCT’s equity share is 50% for both the projects. WCT’s current order book of RM2.35 billion, of which RM1.45 billion is outstanding, is sufficient to sustain its construction activities over the next three years.
Property sales under the group’s Bandar Bukit Tinggi 2 boosted the growth in revenue and earnings from property development activities. By year-end 2003, WCT Realty, the group’s property arm, is expected to complete its acquisition of the entire share capital of Bescorp Industries Bhd., a Second Board Kuala Lumpur Stock Exchange company.
The group’s borrowings increased to RM287.65 million during the period under review, but debt leverage remained manageable at 1.07 times moderated by the growth in shareholders’ funds..
During the period under review, WCT changed its financial year end from 31 January to 31 December. Despite the shorter operating period, WCT’s revenue continued its upward trend reaching RM704.45 million from RM473.86 million for the year ended 31 January 2002. WCT’s revenue growth stems mainly from new contracts secured by its civil engineering and construction division as well as its property development activities. In the domestic market, WCT secured a total of RM411 million worth of new contracts in 2002 and 2003 which included Packages 1A and 1B of the Bakun Hydroelectric Project Package CW2. WCT’s overseas portfolio; accounting for around 30% of the group’s order book; also grew with the addition of two projects in Bahrain, namely the RM584 million Bahrain Formula One Racing Circuit project and the RM100 million flyover road at Seef, a shopping district in Bahrain of which WCT’s equity share is 50% for both the projects. WCT’s current order book of RM2.35 billion, of which RM1.45 billion is outstanding, is sufficient to sustain its construction activities over the next three years.
Property sales under the group’s Bandar Bukit Tinggi 2 boosted the growth in revenue and earnings from property development activities. By year-end 2003, WCT Realty, the group’s property arm, is expected to complete its acquisition of the entire share capital of Bescorp Industries Bhd., a Second Board Kuala Lumpur Stock Exchange company.
The group’s borrowings increased to RM287.65 million during the period under review, but debt leverage remained manageable at 1.07 times moderated by the growth in shareholders’ funds..