Singapore's Dayen Environmental (DYEN.SI) expects to be profitable in 2010, after posting losses for the past four years, and is aiming to win $300 million of water contracts in Singapore and the region this year.
CEO Alan Yau said in an interview the firm has bid for over S$300 million ($216 million) of contracts and is also studying a $300-$500 million contract in China, as it concentrates on its core business of engineering and servicing water and waste water plants.
“The company has gone through a rough patch over the past two years and what we've done is to refocus our strategy,” Yau told Reuters on Wednesday. “For Dayen now, we will only be doing water and nothing else.”
The firm posted a loss of $5.5 million in its financial year ending September 2009. The firm reviewed its business and internal controls last year after being reprimanded by the stock exchange regulator for a lapse in governance and transparency.
The firm is bidding for a $220-$240 million contract to build a water treatment plant for the city-state's water authority, as well as smaller water contracts in Vietnam and Cambodia, Yau said.
Yau said the scarcity of water will result in higher government spending on municipal projects. Many governments are spending on infrastructure as part of multi-billion-dollar stimulus plans following the financial crisis.
Dayen expects China to improve its water infrastructure and will also be looking for growth in India and the Middle East, after an investment in the firm by Bahrain-based Moya Holding Company that has enlarged its capital, Yau said.
“India will be a market that we cannot ignore, and we understand that we have to have a presence there,” said Yau. “The Middle East is also a very promising and exciting place for us.”
Dayen competes with much larger local firms such as Sembcorp Industries (SCMN.SI), Hyflux (HYFL.SI) and Keppel Corp (KPLM.SI) for regional projects.
“In three years we will be in the big league,” Yau said.
Dayen halted its shares on Wednesday pending an announcement. The firm's stock rallied 91% last year, versus the broader Singapore index's (.FTSTI) 63% rise.
