TRC Construction Plc (TRC), a listed and small-sized contractor, expects to sign a Bt34-billion contract for a mineral processing plant and facilities at the Asean potash-mining project in Chaiyaphum by the end of this year, its chief executive officer Pa
The project would be the highlight of TRC’s second half that could boost its backlog to Bt38.6 billion by the end of this year. However, the signing of the contract, set for this quarter, has been delayed.
“I’m confident the contract for the mining project would be signed by the end of this year as we have already received a letter of award in February,” said Pasit. He added that if the project took off, income would be realised by 2019.
Pasit said the project has already passed the environmental impact assessment procedure and the delay had been caused by a financial process.
“APOT [Asean Potash Chaiyaphum Plc], which is 20-per-cent owned by the Finance Ministry, held a meeting of its board of directors today, giving me hope that the project would go ahead smoothly,” he said. He declined to give more details of the meeting.
Pasit said the APOT, in which the TRC Group has invested, is in the preparation stage of construction after obtaining the 25-year mining concession in February 2015.
TRC received a letter of award on February 10 from the APOT for turnkey delivery of the project’s mineral processing plant, office building, power supply and facilities worth |Bt34 billion. The TRC Group – |TRC Investment Ltd and TRC International Ltd – holds a 26.22-per-cent stake in APOT. Its holding will be diluted to 25.13 per cent when APOT’s capital is fully paid up to Bt2.8 billion.
During the 25-year mining concession, APOT will produce at least 22 million tonnes of potash, equivalent to US$8 billion (Bt280 billion), said Pasit.
He added that TRC is likely to revise down its revenue target from Bt8.7 billion to Bt3.9 billion although the company still was on target to reach its 2019 goal and achieve an increase of 20 per cent in annual operating results with total income of Bt10 billion. At the end of June, TRC posted its highest backlog amounting to Bt5.8 billion.
However, the company posted a sharp drop in net profit to Bt21 billion for the second quarter due to lower delivery of its works. For the first six months, TRC posted Bt82.6 million net profit, down from Bt141.33 million in the same period of last year.
Pasit said the backlog comprised 54 per cent from pipeline works, 28 per cent from civil works, and 18 per cent from processing plant.
He said the company has set a target for potential bidding projects during this half and the first half of next year worth Bt32 billion, comprising gas transmission pipeline projects, waste-to-energy projects, mass transit projects, and other projects. The company is also studying the possibility of more jobs in Cambodia and Myanmar.