|(From left) SDB group general manager Loong Ching Hong, Teh and Chieng after the company’s annual general meeting yesterday.|
KUALA LUMPUR: Property developer Selangor Dredging Bhd (SDB) will launch two projects worth RM500 million in gross development value (GDV) in financial year ending March 31, 2015 (FY15).
In November this year, it will launch 79 superlink houses (3,200 sq ft in size) in Taman Melawati, Kuala Lumpur, while the second phase of its SqWhere development in Sungai Buloh, Selangor — featuring serviced apartments — will be put up for sale in the first quarter of next year.
The new launches are expected to “generate continuous earnings” and help SDB to pick up from where it left in FY14, when it saw its net profit rise 29% to RM62.17 million on revenue of RM377.28 million.
SDB managing director Teh Lip Kim said the group’s financial performance in FY15 would also be underpinned by its RM1.04 billion in unbilled sales.
While the upcoming projects will keep SDB busy in FY15, the group, which has some 13 acres (5.26ha) of land in Taman Melawati and 60 acres of estate land in Dengkil, Selangor, is also “seriously looking for land” for future developments.
“We have never been fortunate [enough] to have [much of] a land bank … All the 18 pieces of land that we have had, we had to buy them, roll them, develop them and sell them,” Teh told reporters after the group’s annual general meeting yesterday.
Nevertheless, the group’s small land bank has not been a hindrance to its property development plans. SDB has two completed and three ongoing projects in Singapore, where it does not have any land bank.
“Malaysia is a place where there is plenty of land. If we can find land [and develop it] in Singapore, we should be able to find land [and develop it] in Malaysia,” Teh said.
SDB chairman Eddy Chieng Ing Huong said the group’s healthy financial position has allowed SDB to make quick decisions on land purchases each time a suitable plot is available.
“We are always looking for various pieces of land because we are financially sound and able to purchase. We have got more financial headroom.
“We have been prudent with our dividend policy and we have conserved the capital for acquisition [of land] when the right opportunity arises. SDB is also very fortunate to have Wisma Selangor Dredging in Kuala Lumpur, which has a 94% occupancy rate and generates positive cash flow for us,” he said.
Meanwhile, Teh did not confirm or deny a recent report by The Edge weekly that SDB was acquiring a parcel of land for a residential development with a GDV of up to S$350 million (RM888 million) in District 12, Singapore.
She said the group will make an appropriate announcement when there are new land acquisitions.
Despite having no existing land bank in Singapore, SDB aspires to raise GDV contribution from its projects there to 50%, from the existing 20%, in the next few years.
This article first appeared in The Edge Financial Daily, on August 22, 2014.
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