Tropicana 2Q net profit jumps 58.6% on higher revenue

KUALA LUMPUR (Aug 30): Tropicana Corp Bhd’s net profit surged 58.6% to RM52.85 million, or 3.63 sen per share, for the second quarter ended June 30, 2017 (2QFY17) from RM33.32 million or 2.3 sen a year ago on higher revenue, contributed by the group’s core property development operations.

“This reflects the advanced progress of construction works on-site [at] many of the group’s ongoing projects which contributed positively towards revenue and profit recognition,” said Tropicana in a filing with Bursa Malaysia yesterday.

Its quarterly revenue grew 24% to RM444.4 million from RM358.08 million last year.

For the cumulative six months of FY17 (1HFY17), its net profit jumped 76% to RM85.37 million or 5.9 sen a share from RM48.49 million or 3.35 sen a share in the previous year. Its revenue grew 28.1% to RM826.26 million from RM645.01 million last year.

Going forward, while the short-term prospects are expected to remain challenging, Tropicana said the group believes that there will still be demand for properties in prime locations with accessibility to good amenities and attractive pricing.

The group recently unveiled “Tropicana Urban Homes” to address the underlying needs of the middle-income community, which will create a new revenue stream for the group, said Tropicana.

Tropicana said the group’s strategy continues to be market-driven and is focused on unlocking the value of its landbank in the Klang Valley, in the northern region, as well as in the southern region.

As at June 30, 2017, the group’s unbilled sales stood at RM2.11 billion, which are expected to continue to contribute positively to earnings in the near future, said Tropicana.

Tropicana achieved total new sales of RM508.6 million in 1HFY17.

“In terms of take-up, The Residences at KL City Centre and Cheria Residences, the third residential phase of Tropicana Aman, registered impressive take-up rates of 85% and 80% respectively,” said Tropicana in a separate statement yesterday.

Meanwhile, the third residential phases of both Tropicana Heights and Tropicana Metropark, namely the Ridgefield Residences and Tower A of the Paisley Serviced Residences, also recorded 65% take-up rates for each development, Tropicana added.

This article first appeared in The Edge Financial Daily, on Aug 30, 2017.

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