CRESBLD ... Jan10

It is biding for some RM3 billion worth of private and public jobs in the country in the current fiscal year.

It aims to secure a higher value of projects to boost annual revenue growth by at least a tenth. It was eyeing areas with “less projects, competition and players” such as flood mitigation and water treatment plant jobs, on top of its staple undertakings in real estate construction.

Crest hopes to secure some RM500 million of the RM3 billion worth of construction projects it plans to tender for. The RM500 million is two-thirds more than the builder’s previous annual target of RM300 million.

Of great interest is Crest’s potential venture into the water-concession business by virtue of its involvement in water facilities.

As a building contractor, Crest undertakes construction projects for private property development firms. It is also involved in a wider scope of government jobs, including education facilities, offices and utilities.

In 2009, Crest secured about RM320 million worth of property construction projects on prime land in Kuala Lumpur. In December 2009, the firm clinched from Exceljade Sdn Bhd a RM175.5 million contract to undertake super-structure works for two towers of 40-storey serviced apartments in Jalan Tun Razak and Jalan Raja Muda Abdul Aziz. In Nov 2009, Crest was awarded by Khor Joo Saik Sdn Bhd a RM145.3 million project involving super-structure works for a 35-storey office tower in Jalan Ampang.
At present, Crest’s revenue is derived entirely from Malaysia. Construction income constitutes over 90% of its top line.

The builder currently has a construction orderbook of around RM1.5 billion while unbilled sales from its building projects stand at some RM1 billion, which is expected sustain the group’s earnings till the middle of the financial year (FY) ending Dec 31, 2012.

Unbilled sales refer to the value of construction jobs undertaken which have yet to be recognised in a company’s books.

Crest planned to launch some RM350 million worth of properties in FY10, more than triple the RM100 million unveiled in the previous year. The launches include two mixed development projects in the Klang Valley — phase 5 of its Alam Idaman job in Shah Alam and in Damansara Perdana. For FY10, the company aims to achieve some RM210 million worth of real estate sales, accounting for 60% of the RM350 million worth of launches targeted for the year.

The developer’s landbank of about 16ha (40 acres) are located in the Klang Valley — in Shah Alam, Kelana Jaya, Damansara Perdana and Mont’ Kiara.

In 2008 that Crest intended to develop more commercial properties in the Klang Valley to boost recurring rental income, a move which may eventually prompt the company to set up a real estate investment trust.

Recurrent income from commercial real estate leases, or potential water concessions, is deemed important to safeguard against cyclical income from construction and property development.

Crest hoped to expand abroad, possibly into Singapore and Vietnam besides Middle East countries such as Qatar and Oman.