NWP optimistic of returning to the black in two years

KUALA LUMPUR: NWP Holdings Bhd, which has been running on losses since 2006, is confident of returning to the black in two years, driven by its on-going construction projects, said the company’s adviser, Datuk Seri Dr Alex Teh.

It recorded a net widened net loss of RM2.99 million for the financial year ended Aug 31, 2016 against RM2.23 million a year ago, due to lower contribution from its core business of manufacturing and trading of timber and timber-related products.

Yesterday NWP signed a share purchase and shareholders agreement with Almaniaga Sdn Bhd for the acquisition of a 51% stake in Sinar Majumas Sdn Bhd for RM1.5 million.

Sinar Majumas currently holds the rights to undertake and manage the installation and connection of an electric and water supply to 27 refugee settlements sites and villages in Sabah under the Community Refugee Settlement Scheme.

The project will be jointly undertaken by the two companies, which NWP believes it can collect about RM19 million a year in returns after the completion of the project in 2019 through water and electricity usage charges, while the construction cost will be a one-off.

Teh dubbed the project as an “immediate cash income” and said that the company will begin with nine sites for starters.

“We have allocated enough funds for the nine sites and will use these sites to generate the money needed to pump in to embark on the remaining 18 sites,” he told reporters after the signing ceremony yesterday.

The construction and infrastructure of the nine sites amounts to RM6.3 million and will be financed internally.

Should Sinar Majumas be profitable in this project, NWP is looking forward to paying out dividends to shareholders as well as acquiring the necessary equipment for the installation and connection of electricity to the sites, with the generated cash-flow.

NWP has not been paying dividends since 2004 in view of its weak balance sheet.

On the company’s ongoing projects, Teh said its construction project with Listari Marina for a nine-storey tower block in Malacca, is ongoing. For the PR1MA housing projects in Kelantan, Pahang, Sabah and Selangor, aside from the signing of the memorandum of understanding with M2B World Sdn Bhd, a definite agreement is yet to materialise. – by V. Ragananthini