Friday 29 Mar 2024
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KUALA LUMPUR (March 15): Selangor Properties Bhd, whose controlling shareholder is in the midst of taking it private at RM6.30 per share, announced that it posted a net profit of RM23.04 million in the first quarter ended Jan 31, 2019 (1QFY2019) compared to a net loss of RM40.94 million in the previous corresponding quarter.

According to a bourse filing today, the company’s foreign exchange losses shrank substantially to RM5.2 million in the quarter under review compared with RM52.8 million a year ago.

Quarterly revenue expanded by 67.4% to RM48.04 million, from RM28.69 million the year before, on the back of higher revenue contribution from property developments in both Malaysia and Australia.

On its outlook, the group said that 2019 would remain challenging due to the oversupply of commercial and office space and residential properties in the Malaysian property market.

“In view of the subdued property market, it is not expected that there will be any significant change in fair value of the group's investment properties, which are expected to be able to maintain their present occupancy and rental rates in the current financial year,” said the developer in the result note.

It added that in light of the soft property market, the group is ramping up its marketing efforts to increase unit sales of its AIRA Residence project, while adding that the target launch of the fourth phase of its Bukit Permata development during the first half of 2019 (1H2019) is expected to contribute revenue-enhancing sales.

However, it noted that it will only re-assess the feasibility of its Wisma Damansara development upon the revisitation of the Government freeze on the construction of new residential developments above RM1 million, as well as prevailing market conditions at that point.

The Wen family is seeking to take the firm private through its special purpose vehicle Kayin Holdings Sdn Bhd.

On Jan 15, Kayin Holdings Sdn Bhd, which controls 68.23% of the group’s share capital increased its offer price per share to RM6.30 from RM6.

When the privatisation was first announced on Oct 25, 2018, Kayin Holdings' offer was at RM5.70 per share.

The reason for the two increases in the offer price was the view that the initial offer was too low and was not reflective of the company’s value on the market. Selangor Properties’ net asset per share was at RM7.27 as at Jan 31.

The stock closed unchanged at RM6.22 — with 14,000 shares changing hands — giving the group a market capitalisation of RM2.14 billion.

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