Tropicana's 2Q net profit rises 44% to RM33.3 mil

KUALA LUMPUR (Aug 25): Higher contribution from property projects coupled with reduced finance charges from degearing initiatives helped lift Tropicana Corp Bhd's second quarter net profit by 43.8%.

The property developer posted a net profit of RM33.32 million or 2.3 sen per share in the second quarter ended June 30, 2016 (2QFY16), as compared to RM23.17 million or 1.6 sen per share a year earlier.

Revenue rose 14.6% to RM358.08 million from RM312.34 million, boosted by higher revenue recognition from key projects in the Klang Valley and the northern region of Peninsular Malaysia.

No dividend was proposed for the quarter.

Tropicana said net profit for the first six months of the financial year (1HFY16) was up 14.3% to RM48.49 million or 3.35 sen per share, from RM42.44 million or 2.97 sen per share a year earlier.

Revenue fell 8.3% to RM645 million from RM703.26 million, as 1HFY15 revenue included proceeds from a land sale of RM106.8 million.

Tropicana expects prospects in FY16 to remain challenging, but believes there will still be demand for landed properties and integrated developments in prime locations with accessibility to good amenities and attractive pricing.

Hence, its strategy for the year will continue to be market driven and to adapt to market demand while focusing in unlocking value of its land bank, both in the Klang Valley and the northern region.

"The group possesses a sizeable land bank across Malaysia which provides the group with the potential of unlocking the gross development value of more than RM50 billion.

"The group's unbilled sales stood at RM2.8 billion as at June 30, 2016, which is expected to continue to contribute positively to the earnings in the near future," it added.

Shares in Tropicana closed one sen or 0.95% higher at RM1.06, for a market value of RM1.51 billion. —

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