Press Releases

• Divestment of SPLASH allows Company to sharpen focus in core businesses
• Ongoing Business Transformation and Value Creation Plans to lead future growth organically and via new business catalysts
• Shareholders approve single tier final dividend of 4.25 sen in respect of financial year ended 31 December 2018

Shah Alam, Malaysia, 23 May 2019 – Kumpulan Perangsang Selangor Berhad (“Perangsang Selangor” or “the Company” or “the Group”) (KPS, Bursa: 5843; Bloomberg: KUPS:MK; Reuters: KPSB.KL), having concluded its investment in Syarikat Pengeluar Air Sungai Selangor (“SPLASH”) on 24 April 2019, expects to further align its business direction and investment focus on the core businesses within the manufacturing, trading, licensing and infrastructure sectors.

In line with this development, Perangsang Selangor no longer has direct exposure in the water industry. To reflect this, under Bursa’s sector classification, the Company has been reclassified from the Utilities sector previously to the Industrial Products & Services sector currently. The reclassification which came into effect on 8 April 2019 mirrors the Group’s business concentration in the manufacturing sector and future business direction. It will also allow the investment community to make the right business benchmarking when analysing the appeal and prospect of the Group.

Ahmad Fariz Hassan, Managing Director / Group Chief Executive Officer of Perangsang Selangor commented on the divestment:

“With the completion of SPLASH divestment, we can now focus fully on executing our Business Transformation and Value Creation Plans to unlock the full potential of our core businesses, thus on track in creating long term value, strengthening our core earnings base and ultimately generating greater sustainable returns for Perangsang Selangor and its shareholders.”

FYE 2018, the Group generated a strong revenue of RM582.3 million as compared to RM361.5 million in 2017, posting a significant increase of 61.1%. This achievement is the result of the implementation of the Business Transformation Plan (“BTP”), a sustainable growth agenda which embeds continuous value creation plans to enable Perangsang Selangor to rise above the challenges that were present in the operating environment.

The manufacturing division contributed 61.4% or RM357.5 million to the Group’s revenue. Century Bond Bhd led the revenue contribution with RM189.9 million on higher traction from its paper, carton and plastic divisions. Based on a nine-month consolidated contribution, CPI boosted the Group’s revenue by RM127.3 million on steady growth from its plastic division. Next, King Koil Manufacturing West LLC contributed RM40.3 million with the commissioning of its mattress manufacturing plant in Arizona in May 2018, which was based on an eightmonth consolidated contribution.

Besides the manufacturing business, the Company also made positive progress in its trading business via its 51%-owned subsidiary Aqua-Flo Sdn Bhd contributed 19.1% or RM111.1 million, mainly driven by stronger sales of water chemicals from higher contracts awarded as well as sustained sales from miscellaneous projects. Licensing business via King Koil Licensing Company contributed 5.2% or RM30.3 million, while infrastructure businesses comprises of KPS-HCM Sdn Bhd and Smartpipe Technology Sdn Bhd contributed 12.6% or RM73.1 million to the Group’s revenue.

Perangsang Selangor has demonstrated its commitment to long-term shareholders value creation by taking strategic measures to seize growth potential for sustainable business expansion. Since the BTP was rolled out in 2016, the Group has experienced a positive transformation, and this was proven by steady total shareholders’ return (“TSR”) contributed mainly from stable dividend distributions. TSR as at yesterday was 44%, outperforming the KLCI by 37%.

“In addition to repositioning Perangsang Selangor’s brand, the BTP has also prepared the Company for its future and addressed its new earnings dynamics resulting from the divestment of SPLASH. The ongoing BTP and continuous value creation plans set for each of subsidiary companies will lead future growth not only organically but also via new business catalysts, placing emphasis on geographical, sectoral and product diversity. This will provide the Group with the resilience to weather swings in economic cycles and strengthen Perangsang Selangor’s position in the industry,” he added.

“The prospect for our businesses will, to some extent, trail the global and regional economic outlook, which is expected to remain challenging in the foreseeable future. However, I believe the Group is well positioned to capitalise on new opportunities given the growth strategy that is already in place. We have expertise in respective fields of our businesses, having the capacity to improve and expand, and from which are expected to command strong doubledigit topline margins. This bodes well for Perangsang Selangor in ensuring earnings quality and diversity,” Ahmad Fariz concluded.

Meanwhile, at the AGM, Perangsang Selangor’s shareholders approved the final single tier annual dividend of 4.25 sen per ordinary share in respect of the FY2018. The final dividend will be payable on 19 July 2019, entitled to shareholders registered in the Records of Depositors at the close of business on 28 June 2019.

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About Kumpulan Perangsang Selangor Berhad (www.kps.com.my)

Incorporated on 11 August 1975, Kumpulan Perangsang Selangor Berhad (“Perangsang Selangor” or “the Group”) is a public limited liability company listed on the Main Market of Bursa Malaysia Securities Berhad under the Industrial Products & Services Sector. Perangsang Selangor has focused investments in four core sectors namely, the Manufacturing, Trading, Licensing and Infrastructure. While strengthening our business to optimise returns, Perangsang Selangor is committed to providing significant contributions towards sustainable development in the areas of economic, environment and social for the benefits of all stakeholders.

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