by IZZAT RATNA
PROPERTY developer Hua Yang Bhd remains focused on the affordable housing segment with approximately RM322 million worth of new projects slated to be launched in the financial year ending March 31, 2018 (FY18).
CEO Ho Wen Yan said the new projects would join the stable of other properties worth RM718 million introduced in FY17.
The projects would also boost the company’s profile with a total of more than RM1 billion worth of new projects across key regions.
“We also expect a more meaningful contribution from our associate investment in Magna Prima Bhd (MPB), as we commence our collaboration to realise the value of its existing prime assets and sustain a longer-term viable development strategy for the company.
“Our focus is also to drive new sales in order to improve earnings visibility,” he said in a statement yesterday.
On April 19, 2017, a wholly owned subsidiary entered into a conditional share sale agreement (SSA) with Fantastic Realty Sdn Bhd, Lee Shu Shun, Lee Kong Meng, Yap Fatt Thai, Kok Sew Hong and Kok Siew Hwa for a proposed acquisition of 66 million MPB shares.
The shares represent approximately 20.12% of equity interest in MPB, with a price tag of RM123 million.
The SSA was completed on June 19, 2017, and as a result, MPB became a 30.95% associate of the Hua Yang Group.
During the quarter under review, Hua Yang’s projects in Johor were the largest contributors to its revenue, making up 35% of the total amount.
This is followed by the Klang Valley with 31%, Ipoh (23%), Penang (6%) and Negri Sembilan (5%).
The company began its FY18 with a profit after tax of RM1.7 million for the first-quarter ended June 30, 2017 (1Q18), a decrease from the RM23.9 million recorded in the corresponding quarter last year.
Revenue for the quarter was also lower at RM47.9 million compared to RM128 million recorded a year ago.
Earnings per share for the three-month period was 0.49 sen, while net assets per share as at June 30, 2017, stood at RM1.70 compared to RM1.69 at the end of FY17, with total unbilled sales at the end of the quarter at RM204.3 million.
For the quarter under review, revenue and profit before tax decreased by 63% and 91% respectively compared to the previous financial year’s corresponding quarter.
The lacklustre performance was due to fewer ongoing projects, while newly launched projects like Astetica Residence and Meritus Residence are still in the early stage of construction.
Revenue and profit from other operations mainly consist of rental income derived from the operation of commercial properties under the “build, operate and transfer” concession with local authorities.
Its share price closed at RM1.02 with a market capitalisation of RM359 million as at yesterday.