KUALA LUMPUR: Building management services provider, AWC Bhd announced its wholly-owned subsidiary, Ambang Wira Sdn Bhd (AWSB), has agreed to mutually terminate the maintenance contract with the government for the Southern Integrated Terminal (TBS) worth RM130 million.
AWC in a filing to Bursa Malaysia today said it had earlier received, accepted, and returned a Letter of Acceptance of Tender from the government for the facilities management of TBS in Bandar Tasik Selatan in its announcement dated June 9, 2016.
The company said the contract had been deferred on Aug 26, 2016, pending the resolution of certain operational and technical matters between the government and the existing contractor.
The maintenance was for five years.
“The mutual termination agreement will negatively impact AWC’s financial performance over the intended duration of the original contract.
“However, the impact is expected to be minimal as AWSB has secured other new contracts over the last three months as had been previously announced,” it said.
Meanwhile, in a separate statement, AWC Managing Director/Group Chief Executive Officer, Datuk Ahmad Kabeer, said: “We are disappointed with the termination of the TBS contract, however, our facilities division has secured an impressive RM131.4 million worth of maintenance contracts over the past few months from the Public Works Department that minimises the impact from the TBS contract termination.”
The current outstanding order book for the facilities division stands at RM851.6 million and represents a cover of about 7.4 times its financial year ended June 30, 2017 division revenue.
"This puts us in a good position to sustain growth for the division as we continue to aggressively tender for more contracts,” he added.
On Bursa Malaysia today, AWC's shares ended one sen lower at RM1.02 with 111,600 shares traded. - Bernama