Fajarbaru clinches RM11m contract for RMAF Butterworth base redevelopment

• Back in July 2023, the Australian Department of Defence hired both Fajarbaru Builder Sdn Bhd and Avionics in the planning phase of the military facilities redevelopment.

KUALA LUMPUR (March 15): Fajarbaru Builder Group Bhd has been awarded a minor works contract worth RM11.04 million for the partial delivery phase (early works) of redeveloping military facilities at the Royal Malaysian Air Force (RMAF) base in Butterworth, Penang.

In a filing with Bursa Malaysia on Friday, the construction and property development outfit said the Australian Department of Defence had awarded the contract to its wholly owned unit, Fajarbaru Builder Sdn Bhd (FBSB) and Avionics Pty Ltd, which is wholly owned by Avionics Holdings Pty Ltd.

The total contract was RM13.81 million, of which FBSB’s portion of the contract was RM11.04 million, while Avionics’ portion was RM2.77 million.

Back in July 2023, the Australian Department of Defence hired both FBSB and Avionics in the planning phase of the military facilities redevelopment. Earlier this year, the value of the contract was revised to a higher sum. For FBSB, the value was revised to RM12.3 million (from RM7.36 million), while Avionics’ was revised to RM8.49 million (from RM4.53 million).

With the latest early works contract, the total value of FBSB’s work secured for the project is now RM23.34 million.

The new contract will expand FBSB's involvement in the design and construction of infrastructure projects to redevelop both Australian-leased and Malaysian facilities at the military base.

The contract, which will commence on March 18 and is scheduled to be completed on Nov 21 this year, is expected to contribute positively to the group’s earnings for the financial year 2024 and 2025.

“Over the long run, we believe that this project will be a significant contributor to our earnings. We continue seeking opportunities to further expand our involvement in this project, by bidding for more packages with a focus on value-added and negotiated business,” said Fajarbaru group executive chairman Tan Sri Chan Kong Choy in a statement.

Fajarbaru’s construction division currently has an order book of RM927 million — nearly four times higher than its market value of RM242.02 million — with a wide range of projects such as high-rise residential buildings, affordable apartments, retail complexes, service apartments and the redevelopment of military facilities.

The group is tendering for construction projects with a combined value of RM4.7 billion across the private and government sectors.

Shares in Fajarbaru closed unchanged at 32.5 sen on Friday, with a market capitalisation of RM242.02 million.

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