Friday August 3, 2012
Faber says days of losses are over
By DANIEL KHOO
KUALA LUMPUR: Faber Group Bhd says it will not record anymore quarterly losses this financial year ending Dec 31 (FY12) and expects profitable quarters ahead on the backdrop of it also possibly securing a hospital support services (HSS) concession deal by year-end.
The healthcare services provider had sunk into the red in the third quarter last year due to its projects in the United Arab Emirates (UAE) which the company said all of it had already been accounted for. This setback in the UAE had caused the company to last year miss its headline key performance indicators (KPIs) for revenue growth of between 12% and15% and a return of equity (ROE) growth of 15%-18%.
In an exclusive interview with StarBiz, the company's chief financial officer, Juliza Jalil, said the coming year would be a profitable one and that “there will be no more (quarterly) losses this year.”
Faber managing director Adnan Mohammad said the company eyed returns for its shareholders based on a KPIs of revenue growth of 10%-12% and an ROE growth of 15%-17% in FY12.
Adnan said the company's future was bright premised on the possibility of being able to secure a HSS concession deal with the Government based on his estimates of what had been developing on this front since three years ago.
“In 2009 we put in our letter and between 2009 and 2010 there were several workshops and technical service requirements conducted between the concession companies and the Health Ministry. This is because we need to bring the service level up to a certain stage at the government side,” Adnan explained.
“When we hold the workshop we said: what else can we improve? This is the forum (we had) in that forum new things were brought in to see what else can be improved through the dialogue between the ministry and us. This is basically to see what else can be done to bring up the level of service,” he added.
He said the company aimed to improve its services to the government hospitals with higher standards such as improved turnaround time, minimising downtime, and an increased of new technology usage which will require additional capital investments.
“Some of these equipment, it (the ministry) also wants less disruption so that by the end of the day downtimes will be minimised. It is something like a backup (similar to) the function of an uninterrupted power supply. These are the things that we are discussing to decide on what level and their cost implications,” Adnan said.
“There are going to be cost implications, these new technologies will be needing new equipment and what not so who is going to bear all these? These are things that we have to look at and agree on which is going to take sometime. As far as we are concerned, we want to close this and move forward I think the Government also wants that (and) I am sure it knows what else it is looking at,” he added.
The stock, which had been trending downwards of late, is not of a concern to Adnan who said that it was up to investors to judge the company based on its track record before this. Faber is trading at attractive indicative gross dividend yields of 5.88% after declining 4 sen at its close yesterday to RM1.35.