Vizione eyeing 5-10% revenue growth for FY19

KUALA LUMPUR: Vizione Holdings Bhd expects its revenue to grow 5-10% in the financial year ending May 31, 2019 (FY19) after doubling its revenue in FY18 following the acquisition of construction firm Wira Syukur (M) Sdn Bhd.

For the fourth quarter ended May 31, 2017, its revenue more than doubled to RM16.05 million from RM7.45 million a year ago. Revenue for FY17 rose 33.77% to RM49.10 million from RM36.71 million a year ago.

The group is mainly engaged in property development, construction and property investment.

“I think 5-10% growth is no problem (for FY19). Our revenue next year (FY18) will more than double that this year, after acquiring Wira Syukur,” Vizione managing director Datuk Ng Aun Hooi told reporters at its EGM yesterday.

He said the group is looking forward to better profits post-acquisition, due to Wira Syukur’s profit guarantee of RM82 million (aggregate net profit) for 2017 and 2018, as well as the group’s total order book of RM3 billion.

“At present, we have an order book balance of RM3 billion. Our total order book including work in progress is RM3.6 billion. Replenishment depends on the market but I think with our reputation and networking, with so many years experience, we should be able to do so,” he added.

Ng said the group’s tender book is about RM1.5 billion and it has a success rate of 40-50%. The majority of these contracts, comprising housing and infrastructure projects, are expected to come on stream next year.

“Looking at the market, high-end products are not easy to sell so we are still targeting government projects and some private projects, like affordable homes in good locations … at the same time we also tender for some infrastructure works. These projects are across the country, except Sabah and Sarawak,” he said.

At the EGM yesterday, Vizione shareholders approved the acquisition of Wira Syukur for RM280 million and a private placement to fund the cash portion of the deal.

The acquisition will be satisfied via a combination of cash and issuance of new ordinary shares of Vizione, to be issued at an issue price of 11 sen per share. Vizione will also undertake a private placement of up to 1.69 billion placement shares at a price to be determined later.

“The institutional funds’ portion will be more. Our market capitalisation is small, only RM100 million at present moment. After acquisition, it will be over RM400 million,” said Ng.

He said the company has approached two big funds for the private placement but is unsure whether they will come in or not. He did not name the two funds.
In terms of cash flow, Ng said the current gearing is only 0.06 times but the group may face some cash flow issues when it secures more projects.

“If you look at the records of Wira Syukur and Vizione, bankers’ support and suppliers’ support are very strong. So we will look into the facilities from banks to help us on the cash flow,” he said.

On whether Vizione will declare dividends this year, he said a dividend policy had been discussed before and it hopes to introduce a dividend policy, but will make the announcement in time.

Vizione’s share price rose 3.85% to close at 13.5 sen yesterday with 24.45 million shares traded, giving it a market capitalisation of RM118.11 million.