Matrix Concepts Holdings Bhd
Since listing on May 28, 2013, Matrix Concepts has seen its market capitalisation almost doubled to RM1.3 billion, partly due to its policy of rewarding shareholders well. It paid dividends of 30.4 sen per share in 2013, or a yield of 13.8% against its IPO price of RM2.20. In July 2014, a 1-for-2 bonus issue was declared.

Matrix is famed for its flagship 5,233-acre Bandar Sri Senayan (BSS) township in Seremban. As end-Sept 2014, it has a remaining landbank of 1,289.5 acres at BSS, including Sendayan TechValley (STV), with potential GDV of RM5.1 billion. STV, an established industrial park within BSS, has attracted RM3 billion worth of investments from multinational companies.

Its other projects in Seremban have estimated GDV of RM1.2 billion on 343.6 acres of land. Down south, Matrix is developing the 637.6-acre Taman Seri Impian in Kluang. It has 294.5 acres left to be developed with GDV of RM957 million. Last year, Matrix acquired 1.1 acres of land near Putra World Trade Centre in Kuala Lumpur and aims to launch apartments with GDV of RM400 million in 3Q2015.

All in, Matrix’ remaining land bank has potential GDV of RM6.5 billion to last until 2022. As at end-Sept 2013, unbilled sales totalled RM410.5 million, equivalent to a year’s revenue. Thus, longer term earnings sustainability may be an issue although industrial property sales are more ad-hoc.

Matrix’ net cash fell from RM 191.9 million at end-3Q2013 to RM0.1 million in 3Q2014, due to property development cost of RM556.3 million and the dividend payout. The stock is trading at a trailing 12-month P/E ratio of 7.8 times and 2.0 times book. It has set a minimum 40% dividend payout policy. However, the ability to continue paying high dividends will depend on future profits and cashflows, since its cash position has fallen sharply.

This article first appeared in The Edge Financial Daily, on December 3, 2014.