‘Set up the robot and go for coffee’: ISOTeam bets on automation in its next stage of growth

[SINGAPORE] Anthony Koh may already be 59 years old, but the chief executive officer of ISOTeam is still enrolling himself in artificial intelligence (AI) courses.

The head of the facilities management company is banking on automating his workforce through the use of drones, robots and AI to help take his company to the next level of growth.

One of them is an indoor robot that is able to paint the interior of a HDB flat. All a worker has to do is input the required settings.

“You set up the robot, then you can go for your coffee… Set the colour you want, the thickness you want, how smooth you want. We came back about an hour later, and the room is so nice. All done perfectly,” Koh told The Business Times.

In addition to building up a robotic workforce, he said that the company is planning to venture beyond just public housing maintenance projects to bid for other public sector projects.

“There are a lot of areas that are still untapped, for example, schools, army camps, JTC buildings. We’ve got zero market share there,” he added.

The company already had such plans, but could not implement them due to the disruptions brought about by the Covid-19 pandemic.

As the built environment and construction industry was one of the hardest hit during the pandemic due to mandated stop work orders, ISOTeam’s business plunged dramatically.

But the company is now reviewing these plans again, after coming out of the woods and returning to profitability, as part of its post-pandemic recovery efforts.

Its net profit for the six-month period ending in Dec 31 last year was S$1.9 million, a jump of 36.5 per cent from the same period a year ago.

Nevertheless, its share price has not managed to return to pre-pandemic levels of above S$0.15. Ever since its business was hit by the pandemic, its shares have mostly traded below S$0.10, with its latest trading price on Friday (May 2) at S$0.072.

Robotic workforce

ISOTeam’s foray into robotic workforce is not new. The company had already started using drones to conduct facade inspections of public housing flats in 2021.

It is now planning to roll out other types of drones that can paint and wash the exterior of public housing flats, and is looking to launch them by the end of the year.

“The ultimate outcome is to replace our vendors… Drones don’t have to sleep, (I also don’t have to) pay levies (for them),” said Koh. 

These solutions came about partly as a way to resolve the company’s reliance on foreign labourers – which became an issue during the Covid-19 pandemic.

While pandemic restrictions have been lifted, Koh said that these solutions are still relevant as the industry faces tightening foreign manpower quota. It also helps to cut costs, improve productivity, as well as enhance safety measures, which has been identified as one of the most material environmental, social and governance (ESG) risks for the company.

Stable industry

Public sector projects account for 80 per cent of ISOTeam’s revenue, the majority of which are maintenance services for public housing projects.

Koh said that the company is still focusing its efforts on winning projects in public housing maintenance, as it is a very stable industry with little credit risk.

Furthermore, there will always be a batch of public housing blocks being recycled for maintenance services every five to seven years.

Besides estate maintence, ISOTeam is also involved in installing and maintenaning solar panels on the rooftops of HDB blocks.

As the lifespan of solar farms typically lasts for more than 20 years, Koh noted that this provides a recurring income for the company over the long-term.

“(As long as) the government keeps having these kinds of initiatives, we will never be out of jobs,” he added.

Hence, Koh believes it is the right time for ISOTeam to start expanding beyond its comfort zone and start looking at other public sector maintenance projects outside public housing, including schools, army camps and buildings owned by JTC, a government statutory board that oversees industrial development in Singapore.

“I believe that my skill sets will have use (in these projects). (There is still) a lot of room for expansion in our sector,” he said.

He added that ISOTeam occupies a niche space in the sector as the company takes on projects that are worth between S$5 million and S$10 million. These deals are usually too small for major construction companies, but too big for smaller renovation contractors.

With margins now back at pre-Covid levels, Koh hopes to focus more on the company’s core competences and gain more market share.

“By having more market share and better economies of scale, we believe the margin will be improved… At the same time, we are actively looking at our robotic workforce solutions. If it is able to be implemented smoothly, I believe it will improve productivity and profitability,” he said.