KUALA LUMPUR: Kimlun Corp Bhd hopes to maintain business performance this year, amid costlier fuel, steel pricing, rising wages and some savings on zero-rated goods and services Tax (GST).
“We're hopeful of the new government reviewing mega-projects. We look forward to more transparent and competitive bidding based on equal opportunities and meritocracy,” said Kimlun chief executive officer Sim Tian Liang.
“I think this year, we should be able to maintain our profit margin. Our RM1.94 billion orderbook, as at March 2018, should lasts us for another two years,” he told reporters after the company's shareholders meeting here today.
In its first quarter ended March 2018, Kimlun’s profits fell 18 per cent to RM12.65 million compared with RM15.38 million, a year ago.
Its first quarter revenue, however, rose 30 per cent to RM220.93 million from RM170.18 million, previously.
While Kimlun has to deal with costlier fuel, steel pricing and rising wages, Sim noted the group also see some savings since GST is zero-rated, three weeks ago.
He said more incentives is needed to accelerate the Industrial Building System (IBS) implementation.
IBS is a construction technique where components are manufactured either on- or off-site, then placed and assembled into construction works.
“IBS, when compared to conventional methods, require higher costs due to high capital investment in heavy machinery. We hope the government would lower import duties for heavy machinery,” he said.
“If the government give more incentives to offset the cost, we can ramp up IBS implementation to be less reliant on manual workers. We can then reduce intake of foreign workers,” he added.