Chairman’s Statement


This financial year tested the resilience of the Group as the operating conditions were challenging. The overall macro conditions have not improved and the level of uncertainties have impacted the operations of key operating units.

Despite the difficult operating environment, the financial year under review continued to produce commendable results for the Group.


The Group’s profit after tax achieved a growth of 12.7% to RM23.0 million from RM20.4 million in the previous financial year.


For the financial year ended 31 August 2016, the Group generated RM465.9 million in turnover as compared with RM351.4 million for the preceding financial year.

The increase in turnover is principally contributed by the increase in contribution from WZS KenKeong Sdn Bhd (WZS KenKeong), the civil engineering and construction subsidiary of RM257.6 million as compared with its preceding year’s turnover of only RM155.0 million. The oil and gas subsidiary, Misi Setia Oil & Gas Sdn Bhd (Misi) contributed a turnover of RM113.9 million and the balance turnover was contributed by the manufacturing and other businesses.

The Group’s turnover did not include any contribution from the mining division as the results of the associated companies were only equity accounted.

The major contributors to the Group’s bottom line were bauxite mining and civil engineering and construction with a contribution of RM9.7 million and RM8.7 million, respectively. Whilst the oil and gas division contributed RM3.3 million, the manufacturing and other businesses collectively turned around and posted net profits of RM1.6 million as compared to a loss of RM6.1 million in the preceding year.

The Group’s order book stands at RM931.8 million as at 31 August 2016.

Civil Engineering and Construction Division

The Group’s civil engineering and construction arm, WZS KenKeong was impacted by the intense competition inherent in this industry. After laying the foundation with talent pool and investment in plants and machineries, it is poised to taking on greater challenges and bigger ticket items.

The existing jobs in hand will sustain WZS KenKeong for the next two to three years. Having said that, the Group is confident that its order book will grow well beyond the run-off rate. Presently, all our jobs are infrastructure related works and we are not involved in the construction of buildings.

The Group has entered into a collaboration agreement with UEM Group Berhad and has also proposed the implementation of the Central Spine Road project to the government. The Group is optimistic that the collaboration with UEM Group will be successful.

Oil and Gas Industry Division

The continued weakness in the price of crude oil has severely affected the entire oil and gas industry. Misi, being an onshore oil and gas industry service provider, was not as highly affected by the recent turmoil in oil prices as compare with that of the offshore oil and gas players.

Misi’s investment in the Automated Pipe Spooling fabrication plant in Gebeng, Kuantan has kicked off with the maiden contract to provide pipe spool pre- fabrication work to The Refinery and Petrochemical Integrated Development (RAPID) Package 4 – Amine Recovery Units, Sulfur Recovery Units, Sour Water Stripping Units, Liquid Sulfur Storage Units and Sulfur Solidification Units. This facility has enhanced Misi’s position in providing a more comprehensive suite of services and enabled Misi to strategically position itself to fill the vacuum in the pipe spooling capacity in the local market.

Misi continued to perform well in the areas of products and services for valves and metering for the oil and gas industry. Presently, Misi holds the agency for an extensive metering, valve and related measuring solutions from GE Sensing, IMI CCI, Cameron and Scott Safety.

Given the current circumstances, Misi’s performance is commendable and the Group is optimistic that it will contribute meaningfully to the Group’s profitability going forward.

Mining Division

The Group’s mining operations through its associate companies were adversely affected by the moratorium imposed by the regulatory authorities. The after tax contribution from this division fell sharply to RM9.7million from RM18.5 million in the preceding year.

Despite the uncertainties surrounding the moratorium, the Group is optimistic that issues resulting in the moratorium, given time, will be resolved. Hence, the Group is optimistic of the mining division’s continued significant contribution to its profitability in the foreseeable future.

Manufacturing and Other Businesses

The Group’s bright steel manufacturing business in Malaysia continued to operate under difficult market conditions. Despite the turnaround in the results, the Group remains cautious on the outlook of our manufacturing operations in the coming year.

The Group’s power generation business under WZS Powergen Sdn Bhd has secured orders for supplying standby mobile diesel generators to Sabah Electricity Sdn Bhd and operationally turnaround.

The Group has realigned its businesses that require intensive capital and long gestation period with the disposal, amongst others, of its bright steel manufacturing operations in Indonesia. The disposals of these businesses are to optimise the Group’s return on assets deployed and shareholders’ value.


During the financial year, the Group Corporate Social Responsibility initiatives include visits to an orphanage and an orang asli settlement, namely, Pusat Jagaan Kanak-Kanak Yatim/Miskin Rukaiyah at Sungai Merab Kajang, Selangor and Perkampungan Orang Asli Kampung Donglai Baru, Hulu Langat, Selangor. During the visits, we conducted various activities including birthday celebrations with the orphans, “gotong- royong” to clean and spruce the orphanage and settlement and provided basic assistance.

The Group is committed to its corporate social responsibility and going forward, we will continue to engage in corporate social responsibility initiatives.


The Group has proposed a final dividend of 2 sen per share and a special dividend of 1 sen per share to the shareholders. This final dividend of 2 sen per share represents a pay-out of 30% of its profit after taxation and the special dividend of 1 sen per share represents a pay-out of an additional 15% of its profit after taxation.

Cumulatively, this is well above the dividend policy of distributing 20% to 35% of the Group’s consolidated profit after taxation and non-controlling interests in respect of any financial year to its shareholders.


I wish to extend a warm welcome to Datuk Ahmad Nizam Bin Salleh as an Independent Non-Executive Director. The Group will stand to benefit from his vast experience in the oil and gas industry. I would like to thank our stakeholders, whom comprise shareholders, bankers, customers and suppliers, for their support and trust in the Group. Lastly, I wish to express my sincere gratitude to the Board of Directors, management and staff for their contributions, which are crucial to the Group’s continued success.

On behalf of the Board,
Executive Chairman/Chief Executive Officer