HEB Group to speed up diversification to drive sustainable growth

KUALA LUMPUR: Engineering and project management consultant HSS Engineers Bhd (HEB Group) is looking to accelerate diversification and drive sustainable growth in the financial year ending Dec 31, 2025 (FY25) and beyond.
HEB Group has strategically deepened its involvement in emerging high-growth sectors to broaden its sectoral coverage, while maintaining an entrenched presence in its core infrastructure domains of highways, roads, rail, ports and water infrastructure.
With the rapid expansion of the data centre industry, the group anticipates sustained growth in this sector, supported by favourable government policies and robust foreign investment.
HEB Group's substantial RM2.1 billion order book will provide earnings visibility over the next eight years, building upon the momentum created by the record-high net profit of RM25.2 million achieved in FY24.
The order book includes key projects such as the Pan Borneo Highway Sabah Phase 1A, Westports Expansion Development, Klang Valley Double Tracking Phase 2, East Coast Rail Link, Jajaran Rel Selangor Kita, multiple water infrastructure and data centre projects in Malaysia, in addition to several overseas projects.
The group also has a healthy tender book of RM475 million as it proactively pursues new opportunities in Malaysia and abroad.
'HEB Group has demonstrated agility by adapting its business model to meet the rapidly evolving engineering needs of various industries,' executive vice-chairman Tan Sri Kuna Sittampalam said after HEB Group's annual general meeting today.
'We are rapidly expanding our capabilities to take a leading role in emerging industries that are set to reshape the region.'
Kuna said the group's timely diversification strategy will pave the way for sustainable growth and long-term value creation. Concurrently, HEB Group remains steadfast in its role of supporting governments, both at home and abroad, in implementing strategic infrastructure projects to stimulate economic growth and elevate living standards.
As for its international operations, HEB Group is well on its way to achieving its target of deriving 25% of revenue from overseas projects by 2027. Overseas projects contributed 18.8% of revenue as at March 31, supported by numerous contracts wins in developing countries across Asia.
Kuna said the group is associated with nine countries for projects and that a project in Iraq is providing value-accretive yields with RM1.5 billion in fees. 'However, I expect our Southeast Asian partners like Indonesia and the Philippines will start to contribute more to the company over the next two to three years.'
At the AGM, shareholders approved all the resolutions tabled by the group, including the payment of a final single-tier dividend of 1.46 sen per share for FY24. The dividend payout of RM7.4 million represents about 30% of the HEB Group's net profit last year, and is in line with its dividend policy, which targets 30% distribution of annual net profit to shareholders.

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