2019 UEM Edgenta Annual Report

Ensuring reliability, safety and comfort for users With over 30 years of experience in the infrastructure industry, we provide network routine and asset management for over 3,100 km of roads and expressways in Malaysia and Indonesia. WHO WE ARE Infrastructure Services Operational Review Today, we have expanded our capabilities beyond roads, servicing multiple industries including rail, airports, ports, plantation roads, water and waste water and other commercial and industrial sectors. Our Infrastructure Services division recorded a 3.8% growth in revenue to RM915.6 million despite a challenging operating environment, as we achieved a higher volume of work in Malaysia and Indonesia. The earnings and profitability for the year were also contributed by receipt of the final payment settlement from Abu Dhabi project. FINANCIAL PERFORMANCE (RM MILLION) 2019 2018 Revenue 882.0 915.6 from 2018 3.8% EBITDA 115.9 154.2 from 2018 33.0% PAT 82.0 110.6 from 2018 34.9% 60 KEY INITIATIVES AND RESULTS OUTLOOK AND PROSPECTS In 2020, the Infrastructure Services division will focus on operational efficiency to sustain its profitability, secure new full pavement lifecycle projects in Malaysia and regionally, as well as increase the productisation of technology solutions. In terms of geographical focus, the division will build on its existing pipeline of projects for long-term growth opportunities in Indonesia, Sabah and Sarawak, where there is a significant need for infrastructure development projects of socio-economic importance. The COVID-19 pandemic has directly impacted our business due to the implementation of national directives by the Malaysian and Indonesian governments in response to the crisis, which has reduced utilisation of highways and limited our routine maintenance activities. Despite the limitations, we will continue to sustain our business to continuously provide quality delivery of services to our clients. 61 UEM Edgenta Berhad UEM EDGENTA AT A GLANCE MESSAGE FROM OUR LEADERSHIP STRATEGIC FOCUS OPERATIONAL REVIEW SUSTAINABILITY EFFORTS CORPORATE GOVERNANCE INTRODUCTION FINANCIAL REVIEW ADDITIONAL INFORMATION Key Initiatives Results Regional and Market Expansion • Entered into a joint-operations agreement with Astra Group to provide maintenance services for the Cikampek-Palimanan Highway, which is part of the Trans-Java Toll Road and to embark on other opportunities • Secured first productisation of Road Asset Management System (“RAMS”) for one of the Sarawak State Road concessionaires • Launched Supervisor 2.0, an in-depth and structured safety programme to improve Operations Excellence and HSSE compliance, with participation from 250 supervisors • Partners Operations Dialogue successfully held with more than 450 contractors in attendance • Organised a High-Speed Weigh–In–Motion (“HSWIM”) workshop with participation from Ministry of Works (“MoW”) and Ministry of Transport (“MoT”) to introduce the benefits of the technology and share our expertise on best practices • Won Gold & Silver Award in Malaysia Productivity Corporation (“MPC”) for National, Regional and Mini Convention on Team Excellence People Competencies & Stakeholders Management • Carried out HSSE Contractor Engagement Roadshow 2019 • Launched Mechanised Vehicle to enhance safety and improve efficiencies through out maintenance Operations • Held Safety Day on 22 August 2019 across multiple sites in Malaysia, Indonesia • HSSE continuous learning initiatives and critical training undertaken: - Traffic Management for all frontliners - Defensive Driving for the PROPEL Intervention Team personnel • Won Silver Award for 2018 Good OSH Performance from Malaysia Society for Occupational Safety and Health (“MSOSH”) Awards Health, Safety, Security & Environment Annual Report 2019 Operational Review