Ageson expects its strong earnings momentum to continue into FY21

KUALA LUMPUR (Nov 3): Ageson Bhd is confident of achieving even higher earnings for the current financial year ending June 30, 2021 (FY21) after posting a record-high net profit in FY20.

In a statement, the group said it is positioned for a sustained growth, supported by its RM149 million construction order book and the export market for its silica sand business.

With regards to its property development segment, Ageson said it will be focusing on its upcoming project in Batu Ferringhi, Penang, which has a gross development value of RM178 million. This project will keep this segment busy for the next two to three years, it said.

Ageson currently has a contract with Techpack Solutions Co Ltd in China to supply silica sand with a value of US$79.50 million (RM339.03 million).

Executive director Datuk Seri Chin Kok Foong noted that a new management emerged at the group in 2QFY19, with the group posting a record-high net profit of RM38.9 million, compared with RM2.7 million in FY19. The higher profit was driven by the group’s construction division.

Revenue declined 26% to RM91.41 million from RM122.27 million previously.

Chin, who is in charge of Ageson’s sand operation business, said the group is constantly reviewing its business strategies.

“This is the reason why in 2020, we have decided to diversify into sand mining operations. This would reduce the group’s reliance on its existing core businesses as well as expand its recurring-earnings base,” said Chin.

He believes that its ongoing business exploration and development will yield good results.

“While property development remains soft in this market condition, it does not hamper us from prospecting other business opportunities like trading of mineral resources.

“Apparently, mineral resources like sand are still in demand by our overseas customers. Indirectly, it allows us to expand geographically, increase export sales and it will ultimately boost our business track record,” he added.

Ageson’s shares closed unchanged at 12 sen, valuing the group at RM110.3 million.