Tag: Siab Holdings Berhad

Siab Holdings Berhad Sees Financial Performance Turning Positive in Q1 FY2024

Siab Holdings Berhad (Siab or the Company), an established player in Malaysia’s construction industry, is pleased to announce its financial results for the first quarter ended 31 March 2024 (Q1 FY2024) with 104.7% improvement in Profit After Tax (PAT) of RM0.11 million as compared to the Loss After Tax (LAT) of RM2.33 million from the previous year’s corresponding quarter (Q1 FY2023).

Ng Wai Hoe, Managing Director of Siab
Ng Wai Hoe, Managing Director of Siab

Siab reported a Profit Before Tax (“PBT”) and PAT of RM0.11 million for Q1 FY2024, reversing the Loss Before Tax (LBT) and LAT of RM2.31 million and RM2.33 million respectively, from Q1 FY2023. The loss recorded in Q1 FY2023 was mainly attributable to lower profitability from ongoing projects due to elevated cost of construction materials and higher defect rectification cost incurred for completed projects.

For Q1 FY2024, Siab recorded a revenue of RM26.26 million, compared to RM36.84 million in Q1 FY2023. The decline in revenue is primarily due to lower levels of construction activities in ongoing projects. However, the Company achieved a gross profit of RM2.17 million, a significant improvement from the gross loss of RM0.20 million in the first quarter of 2023.

Mr. Ng Wai Hoe, Group Managing Director of Siab Holdings Berhad said, ” We are positively looking forward to achieving more improved results in the coming quarters. Our focus on cost control and operational efficiency has significantly improved our financial performance. We remain committed to delivering better value to our stakeholders and supporting the growth of Malaysia’s construction industry.”

To recap, Siab has recently signed an Underwriting Agreement with M & A Securities Sdn. Bhd. and NewParadigm Securities Sdn. Bhd. This supports the acquisition of Taghill Projects Sdn. Bhd. (“Taghill”), a construction project and contract management consultancy company. Taghill boasts a robust order book valued at RM1.31 billion and has committed to a profit guarantee of at least RM24.00 million for the financial years 2024 and 2025.

The Company managed to turnaround its financial performance before the acquisition exercise is complete. With Taghill, Siab is in a strong position in tendering projects, enhancing the success rate and catering for a more diverse range of projects.

Looking forward, Siab is optimistic about the prospects of the Malaysian construction industry, which is projected to grow by 6.8% to RM60.49 billion in 2024, driven by resilient domestic expenditure and improvement in external demand. The 2024 Budget, with a record allocation of RM99.00 billion for development expenditure, highlights the government’s focus on home ownership with RM2.47 billion allocated for housing projects. Siab’s orderbook stood at RM314.48 million as of 31 March 2024 and Taghill’s orderbook valued at RM1.31 billion, the Company is well-positioned to capitalise on these opportunities.

M&A Securities and NewParadigm Underwrites Rights Issue with Warrants for Siab Holdings Berhad’s Acquisition of Taghill

Siab Holdings Berhad (Siab or the Company), an established player in Malaysia’s construction industry, is pleased to announce its plans to raise approximately RM103.98 million through private placement, of which RM12.00 million has been completed on 28 December 2023, and rights issue with warrants. These funds will be used to finance the acquisition of Taghill Projects Sdn. Bhd. (Taghill). The rights issue with warrants, valued at RM91.98 million, will be underwritten by M & A Securities Sdn. Bhd. (M & A Securities), the Principal Adviser, Managing Underwriter and Joint Underwriter to the Company, as well as NewParadigm Securities Sdn. Bhd. (NewParadigm), the Joint Underwriter to Siab.

Vincent YH Chu, Deputy Managing Director of Taghill Group; Mr. Yap Kek Siung, Executive Director of Taghill Group; Mr. Ng Wai Hoe, Group Managing Director of Siab Holdings Berhad; Datuk Bill Tan, Managing Director of Corporate Finance from M & A Securities; Mr. Charanjeev Singh, Executive Director/ Group CEO from NewParadigm Securities; Mr. Wong Yih Ming, Founder and Managing Director of Taghill Group[L-R]
Vincent YH Chu, Deputy Managing Director of Taghill Group; Mr. Yap Kek Siung, Executive Director of Taghill Group; Mr. Ng Wai Hoe, Group Managing Director of Siab Holdings Berhad; Datuk Bill Tan, Managing Director of Corporate Finance from M & A Securities; Mr. Charanjeev Singh, Executive Director/ Group CEO from NewParadigm Securities; Mr. Wong Yih Ming, Founder and Managing Director of Taghill Group[L-R]

These efforts support the acquisition of Taghill, a move designed to bolster the Company’s growth trajectory, where the purchase price for Taghill is set at RM122.00 million, to be settled with RM96.00 million in cash and the issuance of 200.00 million new Siab shares at RM0.12 per share as detailed in the circular issued by the Company dated 16 November 2023.

Taghill is a construction project and contract management consultancy company, which has completed 12 major construction projects worth RM1.58 billion, including notable developments like Expressionz Suites and Ceylonz Suites in Kuala Lumpur. Currently, Taghill boasts a robust order book valued at RM1.31 billion and has committed to a profit guarantee of at least RM24.00 million for the financial years 2024 and 2025. Nonetheless, Taghill has a strong orderbook of RM1.31 billion.

Mr. Ng Wai Hoe, Group Managing Director of Siab Holdings Berhad, expressed his excitement by saying, “The integration of Taghill into our operations allows us to leverage on each other’s specialty which will significantly enhances our Company’s overall value and create synergy for us to work together closely over a longer horizon. We appreciate the continuous support and expertise provided by M & A Securities, NewParadigm Securities and our Financial Advisor, Eco Asia Advisory Sdn. Bhd. (“Eco Asia”), in facilitating these transformative initiatives.”

Datuk Bill Tan, Managing Director of Corporate Finance from M & A Securities added, “We are thrilled to assist Siab in these pivotal financial manoeuvres. With the funds raised, Siab is well-positioned to enhance its market presence and seize more opportunities in the dynamic Malaysian construction and property market.”

Mr. Charanjeev Singh, Executive Director/ Group CEO from NewParadigm commented, “The fund-raising exercise and acquisition of Taghill would allow Siab continues its path on becoming the market leading in construction sector in Malaysia. We are truly delighted to be a part of this significant tipping point of Siab.”

The construction industry in Malaysia is expected to expand by 6.8% to RM60.49 billion as supported by broad-based growth across all subsectors. In Budget 2024, the allocation for Development Expenditure (“DE”) stands at RM99.0 billion – which is the largest DE ever to support the significant growth in the local construction industry. One of the most notably initiative includes the Malaysian Government’s focus on home ownership with an allocation of RM2.47 billion, allocated to implement housing projects for the rakyat in 2024. Siab, together with the acquisition of Taghill, is more than ready to support the Malaysian Government ambitious DE in 2024.