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September 07, 2012
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The Edge: AmCorp Prop still banks on local projects for growth
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Business & Markets 2012
Written by Kamarul Anwar of theedgemalaysia.com
Friday, 07 September 2012 08:43
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KUALA LUMPUR: AmCorp PROPERTIES Bhd is banking on its local property development projects in Sibu, Sarawak, and Kayangan Heights, Shah Alam, Selangor, as well as its power and infrastructure businesses for earnings growth in the coming financial year.
Speaking to the media after the company AGM yesterday, CEO Ben KP Lee revealed that despite the much-touted London property acquisition recently, the company still has a strong footing in local property development.
“A developer’s number one dream is to build a township because it is very large and it can last very long. So we have our Sibujaya township that can last another 10 years. Every developer likes to build bungalows, and we have Kayangan Heights in Shah Alam, which is a 100%-bungalow project. So we have a very strong local presence,” he said.
For the financial year ended March 31 (FY12), AmCorp Properties’ net profit more than doubled to RM101.9 million or 18 sen per share from RM48.68 million or eight sen per share the year before.
The big jump in earnings is attributable to the disposal of several office buildings in London for a net profit of RM70 million.
The property firm posted record high earnings for four consecutive years. This raised questions whether AmCorp Properties could sustain its net profit growth.
The group has a few projects locally that will keep its profit afloat and it will continue to invest in profitable property ventures in London, said COO Azlan Baqee Abdullah, commenting on future earnings growth.
Sibujaya, the RM50.3 million township development project, is a joint venture with Sarawak’s Ministry of Housing. It is half completed.
 Lee (right) and AmCorp Properties Bhd executive chairman Az mi Hashim fielding questions from the media after the company AGM |
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The group’s Seri Mutiara housing project in Salak South, Selangor, with a gross development value (GDV) of RM48.4 million is expected to be completed in the fourth quarter of FY13.
The ongoing all bungalow housing project at Kayangan Heights is also in progress, with 27 of its Kenanga Woods bungalows completed. Another 15 units under the Begonia Crescent line are in progress, with a GDV of RM100.4 million.
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AmCorp Properties on Wednesday announced that it had disposed of six apartments in London worth £7.72 million (RM37.97 million). The estimated gain on disposal is net of disposal cost of RM1.48 million. This translates into a two sen per share net gain for FY13.
In June, the group disposed of its Lexham Gardens apartment block with a net gain of about RM6.6 million. Additionally, it has begun marketing its Baker Street apartment units in Hong Kong, Singapore and London with encouraging sales, as stated in its annual report.
The group has finalised its shareholding agreement with NL Pollen Ltd and HPL (Mayfair) Pte Ltd to form a joint venture for the acquisition of a building block in Mayfair, London, for £23.8 million. It plans to convert the building into high-end residential apartments, according to Lee.
The planning process is estimated to take a year while the funding is expected to finalise in November. The group is confident the plans will all fall into place. As Lee said, “[British] laws are very transparent [and] they protect the investors.”
Besides property developments, AmCorp Properties also has a 4MW hydro-power plant at Sungai Perting, Pahang. It is currently carrying out feasibility studies as part of its effort to increase the existing plant’s capacity. Plans to tap other renewable energy resources, such as solar power, have also been initiated. |
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