Kinergy Advancement on aggressive expansion mode in FY2024

SUSTAINABLE energy solutions specialist Kinergy Advancement Bhd (KAB) continues to ride on aggressive growth as proven by its record-high net profit in FY2023, robust orders of almost RM1 bil by end-2023 and the fact that its concession assets have more than doubled in just a year.

These achievements – alongside pending tenders of RM3 bil – has put the group on the right track for better growth in FY2024.

In FY2023, KAB achieved a milestone with the completion of its re-branding initiative which culminated in a new company name and logo.

This strategic update reflects KAB’s long-standing vision unveiled in 2018 to pivot towards a robust focus on sustainable energy solutions (SES) while enhancing its positioning and identity within the regional energy sector.

The group’s (SES) division will continue to be the major growth driver for KAB across clean energy generation (CE), renewable energy generation (RE) and energy-efficient (EE) solutions.

Under this division, KAB now manages 27 projects with expanding geographical presence in Southeast Asia, namely Thailand, Indonesia and the Philippines.

Notably, the group’s number of concession assets has increased from six to 14 as of end-December 2023. These assets include diverse energy solutions such as co-generation plants, waste heat recovery facilities, solar photovoltaic (PV) systems, a biogas plant and a mini-hydro plant.

Making major leap

“Our strategic pivot towards becoming a focused energy solutions provider has started to yield substantial dividends,” commented KAB’s group managing director Datuk Lai Keng Onn.

Datuk Lai Keng Onn

“The foresight in expanding our SES initiatives has positioned us strongly within the rapidly evolving global energy market by perfectly aligning with Malaysia’s National Energy Transition Roadmap (NETR) and broader sustainability targets.”

In FY2023, KAB’s focused efforts have started to bear fruit, leading to substantial gains with FY2024 projected to witness another major leap. The successful deployment of multiple prospects for the SES segment promises a continued upward trajectory.

Particularly noteworthy is the ongoing 52.0 megawatt (MW0 gas engine power plant project at the Sipitang Oil & Gas Industrial Park which is slated for completion in 2026.

A joint venture with PETRONAS Gas Bhd’s subsidiary Sipitang Utilities Sdn Bhd, the projectr will establish the country’s largest gas engine power plant, a monumental advancement in the local energy sector.

Adding to its strategic initiatives, KAB has recently signed a memorandum of understanding (MOU) with LCS Holdings Co Ltd to explore a 20.0MW solar farm development in the Philippines in addition to having proposed the acquisition of shares in Tunjang Tenaga Sdn Bhd for a 9.6MW hydro plant in Kedah.

These projects are aligned with global investment trends which as highlighted by the International Renewable Energy Agency (IRENA) will require substantial capital infusion into renewables and energy efficiency to meet its 2050 objectives.

Following its concerted efforts, KAB’s revenue in FY2023 jumped RM199.4 mil or 6.6% (FY2022: RM187.0 mil); gross profit rose 47.5% to RM41.4 mil (FY2022: RM28.1 mi); while its net profit soared 862.6% to RM27.6 mil (FY2022: RM2.87 mil).

“These figures represent significant year-on-year growth, driven by our strategic repositioning and dedication to the SES sector. FY2024 is expected to mark another significant leap forward with the realisation of multiple prospects within the SES segment,” envisages Lai who is also KAB’s executive deputy chairman.

KAB reported a robust order book of RM939.0 mil complemented by pending tenders amounting to RM3.0 bil as shown in its annual report for FY2023 ended Dec 31, 2023. This financial solidity is underpinned by strategic shifts towards high-margin SES projects which are a significant contributor to KAB’s profitability.

At the close of today’s trading, KAB was up 1 sen or 2.86% to 36 sen with 8.74 million shares traded, thus valuing the company at RM715 mil. – May 6, 2024

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