Thursday 28 Mar 2024
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KUALA LUMPUR (Aug 29): Dutaland Bhd, which has swung into the red in its financial year ended June 30, 2016 (FY16), is proposing the reduction of its entire share premium account, and a par value reduction, to raise RM441.56 million to eliminate its accumulated losses.

Its accumulated losses at the company level amounted to RM385.33 million, and to RM45.74 million at the group level, as at June 30, 2016

Aside from paring down accumulated losses, the proposed exercise will also enable the property developer and planter to raise funds from the capital market in future, by issuing new shares.

"Both exercise will enable the company to rationalise its statement of financial position by eliminating its entire accumulated losses. This would not only enhance credibility, but also provide a better financial platform for future growth," it explained.

It noted that the closing price of its shares today of 43.5 sen, is 56.5 sen or 56.5% lower from its existing par value of RM1, which prohibits it from raising fresh capital from the market.

As at June 30, 2016, its share premium account was RM18.5 million, which will be used entirely for debt repayment and cancelled off.

As for the par value reduction, it entails the halving of the RM1 par value of each share to 50 sen each, which will give rise to a credit of RM423.06 million to cancel off the remainder of the debt.

As at Aug 23, 2016, being the latest practicable date prior to the date of this announcement (LPD), the company's issued and paid-up share capital was RM846.12 million, comprising 846.12 million shares, which will be reduced to RM423.06 million, comprising 846.12 million shares, after the par value reduction.

After the elimination of its debt, there will be a remaining credit of RM55.97 million, which shall be retained in the capital reserve account to be used for future corporate exercises to be undertaken by the company, it said.

Barring any unforeseen circumstances and subject to all requisite approvals being obtained, DutaLand expects the proposals to be completed by the fourth quarter of 2016.

Separately, DutaLand said it has sunk into red, with a net loss of RM5.11 million in the fourth quarter ended June 30, 2016 (4QFY16), from a net profit of RM2.81 million a year ago, mainly due to the reversal of provision of RM7.1 million recorded in 4QFY15.

Revenue for the quarter come in 17.1% lower at RM10.72 million, from  RM12.93 million a year earlier, on lower contribution from the plantation division.

For the full year, it posted a net loss of RM3.72 million, as compared with a net profit of RM48.69 million, priamrily because there was an RM85 million settlement sum received last year.

Revenue was 19% lower at RM37.79 million, against RM46.65 million, as its plantation division contributed lower revenue.

Going forward, DutaLand said the plantation division is expected to perform better in FY17, as the palm oil selling price has been holding firm, while production is set to increase with the subsiding of the El Nino effect.

On its property division, it said it has launched Phase 4F of the Oakland Commercial Centre.

"The development, comprising 182 units of shops/offices, with a gross development value of approximately RM95 million, is expected to contribute positively to the the segment," it added. 

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