Ireka expects to return in current year, boosted by construction orders

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KUALA LUMPUR (Sept 26): Ireka Corporation Bhd expects to inch back into the black in the current financial year ending March 31, 2015, underpinned by its RM1.2 billion construction order book.

The construction and property company had reported a smaller net loss of RM27.32 million for FY14, as against RM40.21 million for FY13. Revenue however dropped to RM289.68 million, from RM329.93 million.

For the first quarter of the current year, Ireka reported a RM1.85 million net loss despite registering a higher revenue of RM96.2 million.

Speaking to the media after the company’s annual general meeting today, Ireka Executive Director Monica V.H. Lai said RM810 million of the RM1.2 billion order book was still outstanding.

“Presently, we have about 65 acres of undeveloped landbank worth RM2 billion GDV (gross development value) that will be developed over the next five to seven years,” she added.

The group will be launching [email protected] Kasia; and the first phase of ASTA Enterprise Park with an estimated GDV of RM180 million, later this year.

Lai said the construction division will remain as the main driver for the company in the current financial year.

However, the company expects the revenue contribution ratio from its construction division and property division to stand at 50:50, within the next two years.

Presently, the construction division contributes 80% of the company’s turnover, with revenue also coming from information technology and other businesses.

Lai expressed hope that the government will ease the property cooling measures introduced in the 2014 budget, when it tables the 2015 budget on Oct 10.

On the introduction of the Goods and Services Tax (GST) in April next year, she said it should not affect the prices of properties sold by the company.

This is because they were mostly residential units, which are expected to be exempted from the new tax.