PETALING JAYA: UEM Edgenta Bhd, whose digital healthcare solutions segment contributed 64% to the group’s revenue in the first six months ended June 30, 2021 (H1’21), is embarking on transforming itself into a tech-enabled solutions company with a focus on healthcare by 2025.
UEM Edgenta managing director and CEO Syahrunizam Samsudin said of all of its business segments, healthcare offers the highest growth. This is not just because of Covid-19, but in general health is going to be the main agenda for the world in the next 15 to 20 years as technology continues to drive innovation and healthcare, to drive different types of solutions to diseases, and to provide data for assets management.
Besides, he added, all companies will be digital companies in the future, which will be a reality post-pandemic.
“From a CAGR perspective, on the Asia Pacific regional alone, healthcare technology (will maintain a trajectory of) double digit or up to 15% (growth) in this segment. This is a segment we must focus on because the shaping of our revenue line will take shape in concession and non-concession (businessnes). The idea is to have a good 50/50 mix. Hopefully, as we get into ‘Edgenta of the Future 2025’ (EoTF25) we will take more commercial than concession projects which give us better diversifications,“ he told reporters during the virtual briefing (pix) on UEM Edgenta’s H1’21 results today.
UEM Edgenta, an asset management and infrastructure solutions company completed its H1’21 with a net profit of RM12.83 million, on the back of RM1.02 billion in revenue.
“We will continue to focus on our digital solutions rollout, especially in powering sustainability across our businesses, notwithstanding the challenging backdrop, movement controls and shortcomings of the pandemic. We are resolute in managing and expanding our respective operations across multiple industries, driven by our EoTF25 vision as we tap into new markets with innovative and technological solutions, spearheaded by Edgenta NXT, our first digital ecosystem platform, as well as the expansion of our healthcare support services offerings which includes QuickMed, the first cloud-based digital healthcare solution,” said Syahrunizam.
In H1’21, its healthcare support division reported a 14.1% year-on-year (y-o-y) revenue growth that was supported by the operationalisation of key contracts wins from Singapore and Taiwan, as well as higher variation orders for Malaysia’s concession business.
It added that for the remainder of FY2021, the asset management segment led by the healthcare support division will continue to deliver on existing contracts while diversifying its solutions beyond the traditional healthcare support services as it helps to drive the nation’s post-pandemic recovery efforts.
On the infrastructure services division, its chief strategy officer Rais Imran said the outstanding of the order book amounting to RM7.2 billion of its infrastructure services arm with PLUS Malaysia Bhd extends to 2028.
“We have other contracts in infrastructure services with JKR Selangor and JKR Sawarak while PLUS dominates the concession work,“ he said.
Meanwhile, the company does not foresee any further impairment in its property and facility solutions division especially in the second half of this year.
On the RM50 million impairment of completed property inventories under its property development division, CFO Hillary Chua said the impairment loss the group booked last year was related to unsold properties.
“It was booked as a prudent approach or market best practices which the management took because with the weak market condition we were assessing the potential net realisable value of the inventory we had on hand so this is merely a book entry of the RM50 million we have recorded,“ she said.
The recently launched digital ecosystem Edgenta NXT is expected to be the driver for growth as the group ventures into the technology business, as part of its EoTF25 vision.
“Tech-enabled platforms such as digital healthcare, infrastructure and smart facilities management solutions spearheaded by Edgenta NXT will drive new revenue streams and transform our value proposition in the integrated facilities management and healthcare space. We are optimistic of building an order book within the next three to five years. Edgenta NXT is our next phase of growth through new products and market expansion, especially with technology being the major factor towards building future-resilient businesses and create sustainable growth,” said Syahrunizam.
The group is set to resume its dividend payment in FY21 after it withheld dividends last year, as it is committed to returning to its dividend policy. The group is maintaining its dividend policy of a payout ratio of between between 50% and 80%.
