Public-listed power infrastructure provider Pestech (Cambodia) Plc (PEPC) reported a sharp decrease in total revenue in the fourth quarter of 2023 due to the slow progress of some of its projects in the Kingdom.

According to its August 18 filing with Cambodia Securities Exchange (CSX), the Malaysian-owned firm posted a revenue of 8.5 billion riel ($2 million) representing a decrease of 20.3 billion riel or 70.6 per cent in the fourth quarter ended June 30, 2023 compared to 28.8 billion in the fourth quarter of 2022.

The changes in revenue reflected the execution progress of various projects in Cambodia.

As of June 30, 2023, PEPC’s total assets were 1.19 trillion riel representing a 2.8 billion riel drop or 0.23 per cent from 1.20 trillion riel in the financial year ended June 30 2022 while total equity fell 18.6 billion riel or nearly 17 per cent to 91.4 billion in the period this fiscal year from 110.0 billion riel in the previous financial year.

“It is inevitable that revenue generation would continue to remain subdued until our cash flow position improves,” said executive chairman Paul Lim Pay Chuan.

He stated that PEPC registered an operating loss of 653 million riel during the fourth quarter of 2023 compared to 2.5 billion riel in the corresponding period in 2022.

“The lower turnover volume unfortunately was unable to sustain the operating cost, particularly the fixed cost element during this financial quarter of the fiscal year 2023,” Lim said.

He pointed out that loss after tax (LAT) also widened to 10.3 billion riel versus LAT of 3.6 billion riel in the comparative quarter of 2022.

“Persistent state of high borrowing cost and the level of inflation had inflicted significant pressure onto the group, putting limitations on our cashflow manoeuvrability and indirectly impacted the efficiency of business delivery. We are only able to expect a more positive bottom line when the interest rate environment becomes more suppressed, and inflation impact eases,” Lim said.

Meanwhile, PEPC CEO Han Fatt Juan noted that the management stands firm with the group’s ample track record in power transmission infrastructure build up, supported by its well-equipped machinery, and abundant experience in photovoltaic infrastructure design, engineering and implementation, to offer comprehensive turnkey project execution and long term operation and maintenance services to the growing renewable market in Cambodia.

“We will work closely with technology partners in providing reliable and cost effective solutions for renewable energy with storage prospects, to ensure sustainable and uninterrupted supply of green energy for the Cambodian community, with minimal disruption to the national power grid system,” he said.

Despite the gloomy overcast, chairman Lim said the management is working on a turnaround plan, along with the management of its parent company, Pestech International Berhad (PIB), and hoped to be able to deliver positive financial results in the next fiscal year.

“As we move into a new fiscal year, PEPC intends to realign its sustenance plan to regain confidence from its customers, and financial institutions for a refreshed opportunity on procurement of new projects, and the rendering of support for the necessary financing in order to enable the execution of projects efficiently, and effectively.

“In line with that, we reiterate the commitment of the group in maintaining our position as an active participant in the development of power infrastructure projects in Cambodia,” Lim stressed.

The Cambodian unit launched its initial public offering (IPO) on August 12, 2020, by issuing 3.9 million shares, which was around 5.3 per cent of its total 74,945,000 voting shares, at $0.76 per share, which raised proceeds of approximately $3 million.