Protasco ... Dec12

Infra development provider firm Protasco Bhd reported a 194% jump in its net profit to RM18mil for its recent quarter with its revenue also higher at RM206.6mil against RM175.5mil earlier.

It also declared a special plus interim dividend of 10 sen per share.

The better performance was a result of higher revenue from its construction contracts segment and improved operating margins particularly in its construction contracts segment, the company said.

For the nine months to Sept 30, Protasco made a net profit of RM30.73mil on RM484.03mil in sales. This compares with a net profit of RM19.5mil on sales of RM450.4mil a year earlier.

As at Sept 30, the company had some RM41mil in cash and bank balances.

Protasco announced a slew of board changes in coming week including the emergence of a new substantial shareholder, Kingdom Seekers Ventures Sdn Bhd. One of the directors of Kingdom is Tey Por Yee who is the boss of mobile application service provider Nextnation Communications Bhd which is listed on the ACE market.

Tey Por Yee has emerged as the biggest shareholders with a 27.11% stake. He bought the shares at rm1.20. Kingdom Seekers purchased the block of shares from Datuk Mohd Ibrahim Mohd Nor, better known for his foray into Bernas which he controlled until 2003.

Tey says he funded the acquisition via a combination of borrowings and his own funds. At rm1.20 a share Tey would have paid rm96.51 million for the block of 80.43 million shares. He stresses that he is merely an investor and will not get involved in the day to day management of Protasco.

He has been scouting around for a property development company for sometime.

Datuk Mohd Hanif Sher Mohamed was appointed as independent and non executive director.

Mohd Ibrahim bought a small stake in Protasco in early 2010 when the shares were trading at between 90 sen and rm1.00. In June 2012 Mohd Ibrahim increased his interest after buying shares from one of Protasco’s founding members, Datuk Hasnur Rabiain Ismail.

Other long time shareholders include Datuk Chong Ket Pen, who together with Hasnur, started his career in the Public Works Dept before venturing into Protasco Bhd.

Sources say among other changes, Protasco is expected to see an injection of assets soon.

Protasco Bhd known for its concession to maintain 6200km of federal roads in several states in the peninsula as well as Sarawak.

As at end Sept 2012, Protasco had cash and bank balances of rm41.45 million, deposits with licensed banks of rm55 million and short term investments of rm39.70 million. Its short term borrowings amounted to rm31.75 million while long term borrowings were rm4.40 million.

Protasco had a 100 acre land parcel in Sepang with a net book value of rm110.95 million which was last valued in April 2002. It also owns several shophouses and smaller parcels throughout Malaysia.

The company started developing the 100 acres in 2007. To date (Dec 2012) it has built up two blocks of condo.

Its present bulk of earnings comes from its concession to maintain 6200km of federal roads in Pahang, Selangor, Terengganu and Kelantan.

The concession is held by its 51% unit and expires in 2016. Through the wholly owned subsidiary HCM Engineering Bhd, it also holds the concession to maintain 420km of roads in Sibu, Mukah and Bintulu in Sarawak.

There is no change in the concession despite the change in shareholding.

While Tey’s investments in Protasco has its merits, how his plans for the company play out remains to be seen.