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KUALA LUMPUR: Property developer Talam Corporation Bhd plans to clean up its balance sheet by reducing gearing and repaying its debts this year, before launching new projects in the second half of next year.
The group was also committed to completing and handing over sold units of its current projects in Puchong to purchasers by the end of the current financial year ending Jan 31, 2011 (FY11), said its chairman Adrian Tsen Keng Yew.
"We plan to complete the majority of them by the end of the financial year and deliver them to the purchasers. Once we have done this... only then we could obtain the permits to launch new projects," he said after the company's AGM here on Thursday, July 29.
Tsen said the units in Kinrara Section 3, Puncak Jalil and Saujana Puchong had been completed and were being arranged for inspection. These units had progress billings of RM100 million, he added.
"We have to redeem our name before we can apply for permits for new projects," he added. Talam still has debts owing to the Selangor government. According to its annual report, the three projects have a combined estimated gross development value (GDV) of RM3.19 billion, with total recorded sales of RM2.58 billion as of Jan 31, 2010.
For the financial year ended Jan 31, 2010, Talam's net profit dropped 86% to RM8.31 million from RM59.1 million a year earlier, while revenue fell 15.8% to RM253.71 million from RM301.28 million. Earnings per share fell to 0.42 sen from 9.39 sen.
Talam had its Practice Note 17 (PN17) status lifted on June 9, after it pared down its debts, which now stand at RM531.7 million and mainly consist of Islamic debt securities, and term and bridging loans.
Its debts had fallen by 29% from RM752.4 million a year earlier, as cash was raised through the disposal of properties and from payments.
With shareholders' funds standing at RM608.58 million, Talam still has a high net gearing ratio of 0.87 times.
Talam executive director Chua Kim Lan said the company planned to reduce its net gearing to 0.5 times within the next two years. The group is also disposing of five parcels of land measuring 1,300 acres to settle the balance of its RM150.62 million debt to Menteri Besar Selangor Incorporated (MBI).
The debt is part of the total RM392 million originally owed to MBI, of which RM241.37 million has been settled.
"The settlement is pending completion and is subject to approval of our shareholders in October. We hope to complete it by the end of the year," Chua said.
She said after the settlement, Talam would have 2,000 acres of landbank left in Selangor with an estimated GDV of more than RM1 billion.
"We still have landbank in areas such as Selayang and Ulu Kelang and we are looking at launching industrial factories as well as residential units.The landbank would last us for another two to three years," she said.
"The financial woes had taught us the dangers of being highly geared, and not to retain too much landbank. In the 1990s, we used to have 18,000 acres of land with liabilities of up to RM4 billion. With a cleaner balance sheet, we would only look at new launches next year," added Chua.
Talam closed unchanged at 11.5 sen on Thursday with 10.34 million shares traded.
The group was also committed to completing and handing over sold units of its current projects in Puchong to purchasers by the end of the current financial year ending Jan 31, 2011 (FY11), said its chairman Adrian Tsen Keng Yew.
"We plan to complete the majority of them by the end of the financial year and deliver them to the purchasers. Once we have done this... only then we could obtain the permits to launch new projects," he said after the company's AGM here on Thursday, July 29.
Tsen said the units in Kinrara Section 3, Puncak Jalil and Saujana Puchong had been completed and were being arranged for inspection. These units had progress billings of RM100 million, he added.
"We have to redeem our name before we can apply for permits for new projects," he added. Talam still has debts owing to the Selangor government. According to its annual report, the three projects have a combined estimated gross development value (GDV) of RM3.19 billion, with total recorded sales of RM2.58 billion as of Jan 31, 2010.
For the financial year ended Jan 31, 2010, Talam's net profit dropped 86% to RM8.31 million from RM59.1 million a year earlier, while revenue fell 15.8% to RM253.71 million from RM301.28 million. Earnings per share fell to 0.42 sen from 9.39 sen.
Talam had its Practice Note 17 (PN17) status lifted on June 9, after it pared down its debts, which now stand at RM531.7 million and mainly consist of Islamic debt securities, and term and bridging loans.
Its debts had fallen by 29% from RM752.4 million a year earlier, as cash was raised through the disposal of properties and from payments.
With shareholders' funds standing at RM608.58 million, Talam still has a high net gearing ratio of 0.87 times.
Talam executive director Chua Kim Lan said the company planned to reduce its net gearing to 0.5 times within the next two years. The group is also disposing of five parcels of land measuring 1,300 acres to settle the balance of its RM150.62 million debt to Menteri Besar Selangor Incorporated (MBI).
The debt is part of the total RM392 million originally owed to MBI, of which RM241.37 million has been settled.
"The settlement is pending completion and is subject to approval of our shareholders in October. We hope to complete it by the end of the year," Chua said.
She said after the settlement, Talam would have 2,000 acres of landbank left in Selangor with an estimated GDV of more than RM1 billion.
"We still have landbank in areas such as Selayang and Ulu Kelang and we are looking at launching industrial factories as well as residential units.The landbank would last us for another two to three years," she said.
"The financial woes had taught us the dangers of being highly geared, and not to retain too much landbank. In the 1990s, we used to have 18,000 acres of land with liabilities of up to RM4 billion. With a cleaner balance sheet, we would only look at new launches next year," added Chua.
Talam closed unchanged at 11.5 sen on Thursday with 10.34 million shares traded.
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