Malton lines up RM1.2b property launches for FY15

KUALA LUMPUR: Builder and property developer Malton Bhd, controlled by billionaire Datuk Desmond Lim Siew Choon, has lined up three new property launches with a total gross development value (GDV) of up to RM1.2 billion for the financial year ending June 30, 2015 (FY15), said its director of corporate finance Ng Chee Kiet.

They include phase 2 of the RM3.5 billion Bukit Jalil City project, which is a joint venture development with Ho Hup Construction Co Bhd on a 50-acre (20.2ha) tract of land.

“We will be launching about four blocks or 525 units of serviced apartments by the end of first quarter of 2015 [1QFY15). There will also be 38 retail lots [on offer]. The estimated GDV for this phase is RM600 million,” Ng told reporters after the group’s annual general meeting yesterday.

Malton will also be launching 400 serviced apartment units at its Nova Pantai project in Pantai Dalam, which has a GDV of RM400 million. The entire project features 1,140 units of serviced apartments and 280 affordable apartments worth RM900 million in GDV.

It will also kick off its Ukay Spring project in Ampang, comprising semi-detached and linked houses worth RM180 million in GDV.

Ng said Malton aims to surpass the revenue and net profit growth achieved in FY14 in this financial year with these new launches as catalysts.

Malton ended FY14 with revenue of RM500.3 million, a 39.3% jump from the RM359.2 million recorded in the previous financial year. Its net profit also rose 46.9% to RM52 million from RM35.4 million the year before.

Malton’s 1QFY15 ended Sept 30, 2014 financial results, which was announced on Nov 17, suggest that the low-profile property developer is well on track to beat the FY14 numbers.

For the quarter under review, Malton’s net profit more than tripled to RM15.11 million, from RM4.06 million in 1QFY14, while revenue was higher by 22.5% at RM111.59 million. This, though, was partly boosted by the completion of the disposal of parcels of land for RM35.7 million.

On land bank expansion, Ng said the group is “quite comfortable” with its current land bank of over 600 acres and is not actively looking to purchase more.

“It [acquiring land bank] is just not a very urgent need right now because we have enough land to keep us busy [for the next 10 years]. We are more focused on delivering the projects we have now,” Ng added.

Of Malton’s total land bank, 200 acres are located in Pengerang, Johor — an area designated as Malaysia’s upcoming regional oil and gas hub.The Johor land is worth RM500 million in GDV.

Ng said Malton is planning a township development there. The first phase of development will likely include the sale of 60 units of 2-storey shoplots in FY16. The remaining land is planned for residential and commercial developments.

Malton also owns a 300-acre tract of leasehold land in Batu Kawan, Penang which it acquired in 2012. This plot of land is ideally located near the exit of the Penang Second Bridge.

Ng said that the Batu Kawan land will be progressively developed over the next 10 years and any development on it will likely start only in FY16, subject to obtaining regulatory approval.

The potential of Malton’s new projects has also caught the attention of analysts. RHB Research said, in a note dated Sept 2, that it expects Malton to chalk up RM500 million to RM600 million in new sales for FY15, double from about RM270 million sales (excluding the en bloc disposal of V Square in Petaling Jaya) in FY14.

This article first appeared in The Edge Financial Daily, on November 21, 2014.