KUALA LUMPUR: The project delivery partner (PDP) of the River of Life project, Ekovest-MRCB JV Sdn Bhd, will earn more than just the RM22 million fee in the coming three years, said Ekovest Bhd managing director Lim Keng Cheng.
Lim pointed out that the joint venture firm, will get better benefits as the PDP of the project than being a sub-contractor bidding for the work packages of the River of Life project. Ekovest has a 60% stake in the Ekovest-MRCB.
Speaking after the company’s AGM, Lim told the media that Ekovest-MRCB might participate in the beautification of a 10.7km portion of the Klang river, but will not take part in the river cleaning works. He said according to the agreement between Ekovest-MRCB and the federal government, the PDP is not allowed to tender for the land along the 10.7km portion of the river.
Furthermore, the joint venture firm is not permitted to bid for the river cleaning works for the 110 km of the Klang river that runs through the capital.
However, according to Lim, the agreement is silent on the beautification works of the project.
“As the PDP, our role is to coordinate the 43 government agencies to make sure the project be delivered on time, and we also have some monetary incentives, where we should look into enhancing the value of the land, the various engineering on the cleaning of the river, and ensure the KPI (key performance indicator) is met on the beautification of the river,” said Lim, who is the nephew of Datuk Lim Kang Hoo.
Kang Hoo is the major shareholder of Ekovest, holding a 24.61% equity stake.
In an earlier announcement to Bursa Malaysia, Ekovest said being the PDP, Ekovest-MRCB would earn a maximum fee of RM22 million, which is equivalent to 1% of the total projected works to be delivered over the three-year period.
In addition, it noted that the PDP will also enjoy “monetary incentives” with respect to the river rehabilitation and beautification works.
However, Lim declined to reveal the details of the “monetary incentives”. He only disclosed that as part of the special monetary incentives, the PDP would earn a sum by helping the government to look for buyers for the land along the riverbank.
Also, he said Ekovest-MRCB would be rewarded if the joint venture firm managed to look for bidders who could do the river beautification and rehabilitation works at the lowest costs, even at costs below the allocated budget.
For 1QFY12 ended Sept 30, Ekovest recorded a net profit of RM6.5 million compared with RM1 million in the previous corresponding period. Revenue rose to RM31.9 million from RM21.3 million previously.
For FY11 ended June 30, Ekovest posted a net profit of RM24.6 million compared with RM10.1 million the year before. However, revenue was sharply lower at RM128.2 million versus RM217.7 million for FY10.
Ekovest attributed the higher earnings to the recognition of RM20.97 million after incorporating the effects of adopting FRS 139 compared to the preceding year.
However, excluding earnings recognition under FRS 139, the company’s earnings were lower compared with the preceding year as a result of a drop in revenue.
Ekovest’s order book stands at RM230 million currently and this can keep the company busy for up to two years, while its tender book stands at around RM3 billion. Ekovest plans to develop its 11.5 acres of land in Cheras into a mixed development worth RM1.5 billion, to be located near an MRT station.
In addition, Ekovest also has 20 acres of land each in Setapak and Iskandar Malaysia.
This article appeared in The Edge Financial Daily, December 20, 2011.
Lim pointed out that the joint venture firm, will get better benefits as the PDP of the project than being a sub-contractor bidding for the work packages of the River of Life project. Ekovest has a 60% stake in the Ekovest-MRCB.
Speaking after the company’s AGM, Lim told the media that Ekovest-MRCB might participate in the beautification of a 10.7km portion of the Klang river, but will not take part in the river cleaning works. He said according to the agreement between Ekovest-MRCB and the federal government, the PDP is not allowed to tender for the land along the 10.7km portion of the river.
Furthermore, the joint venture firm is not permitted to bid for the river cleaning works for the 110 km of the Klang river that runs through the capital.
However, according to Lim, the agreement is silent on the beautification works of the project.
“As the PDP, our role is to coordinate the 43 government agencies to make sure the project be delivered on time, and we also have some monetary incentives, where we should look into enhancing the value of the land, the various engineering on the cleaning of the river, and ensure the KPI (key performance indicator) is met on the beautification of the river,” said Lim, who is the nephew of Datuk Lim Kang Hoo.
Lim (left) and executive director Cho Joy Leong at the press conference yesterday.
Kang Hoo is the major shareholder of Ekovest, holding a 24.61% equity stake.
In an earlier announcement to Bursa Malaysia, Ekovest said being the PDP, Ekovest-MRCB would earn a maximum fee of RM22 million, which is equivalent to 1% of the total projected works to be delivered over the three-year period.
In addition, it noted that the PDP will also enjoy “monetary incentives” with respect to the river rehabilitation and beautification works.
However, Lim declined to reveal the details of the “monetary incentives”. He only disclosed that as part of the special monetary incentives, the PDP would earn a sum by helping the government to look for buyers for the land along the riverbank.
Also, he said Ekovest-MRCB would be rewarded if the joint venture firm managed to look for bidders who could do the river beautification and rehabilitation works at the lowest costs, even at costs below the allocated budget.
For 1QFY12 ended Sept 30, Ekovest recorded a net profit of RM6.5 million compared with RM1 million in the previous corresponding period. Revenue rose to RM31.9 million from RM21.3 million previously.
For FY11 ended June 30, Ekovest posted a net profit of RM24.6 million compared with RM10.1 million the year before. However, revenue was sharply lower at RM128.2 million versus RM217.7 million for FY10.
Ekovest attributed the higher earnings to the recognition of RM20.97 million after incorporating the effects of adopting FRS 139 compared to the preceding year.
However, excluding earnings recognition under FRS 139, the company’s earnings were lower compared with the preceding year as a result of a drop in revenue.
Ekovest’s order book stands at RM230 million currently and this can keep the company busy for up to two years, while its tender book stands at around RM3 billion. Ekovest plans to develop its 11.5 acres of land in Cheras into a mixed development worth RM1.5 billion, to be located near an MRT station.
In addition, Ekovest also has 20 acres of land each in Setapak and Iskandar Malaysia.
This article appeared in The Edge Financial Daily, December 20, 2011.
