KUALA LUMPUR (May 31): LBS Bina Group Bhd and NWP Holdings Bhd have decided to mutually terminate an agreement for a joint development project to transform the Zhuhai International Circuit in China, in which LBS Bina has a 60% stake.

Both parties have agreed to revoke the heads of agreement (HOA) signed on March 5, LBS Bina said in a filing with the stock exchange yesterday.

“LBS Bina and NWP mutually agreed to fully release each other from all the respective obligations and liabilities arising from or in connection with the HOA,” it said.

Both parties had signed the HOA to jointly develop 264 acres (106.8ha) on land in the Gaoxin district, Zhuhai in Guangdong, China.

The agreement had also included the proposed subscription of 73.7% or 1.1 billion shares in NWP by LBS Bina for a cash consideration of RM93.5 million or 8.5 sen per share. This would have triggered a mandatory general takeover offer by LBS Bina for all the remaining shares in NWP that it did not own.

In a separate filing, LBS Bina said it posted a 6.98% decline in net profit to RM23.04 million for the first quarter ended March 31, 2018, from RM24.77 million a year ago.

Quarterly revenue declined 2.92% to RM240.12 million from RM247.35 million on lower contribution from both its property development and construction segments.

LBS Bina said the decline in revenue from the property segment was due in part to the completion of certain projects towards the end of 2017, as well as a typically soft first quarter which coincided with the Chinese New Year holidays and the shorter month of February.

“Nevertheless, the remaining ongoing projects are progressing well and according to schedule,” the group said.

Meanwhile, the construction and trading division recorded lower revenue due to the completion and handover of certain in-house projects.

LBS Bina said its prospects remain positive with total property sales of RM703 million as at May 29, and total unbilled sales of RM1.54 billion as at April 30.

This article first appeared in The Edge Financial Daily, on May 31, 2018.

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