Tropicana records higher second-quarter net profit but revenue dips

KUALA LUMPUR: Property developer Tropicana Corp Bhd saw its second quarter ended June 30, 2014 net profit come in 133.4% higher at RM89.6 million, but revenue dipped 1.73% to RM355.88 million.

In a note to Bursa Malaysia yesterday, the group attributed the higher profit to gains of RM69.9 million arising from the disposals of investment properties and a subsidiary of a jointly controlled entity (JCE).

As for the six-month period ended June 30 (1HFY14), Tropicana registered a net profit of RM97.28 million, an increase of 18.44% from RM82.14 million in the corresponding period last year, while revenue declined 1.85% to RM655 million from RM667.38 million.

Tropicana said in a press statement yesterday that ongoing development projects, such as Tropicana Gardens and Tropicana Metropark in the Klang Valley as well as Tropicana Danga Bay in Iskandar Malaysia in Johor, contributed to development profits in 1HFY14.

The group also achieved sales of RM935 million in 1HFY14, while unbilled sales stood at RM2.7 billion.

“At present, the property market in Malaysia is more subdued as a result of various cooling measures introduced by the government in the 2014 Budget.”

It said the group is preparing to launch new phases consisting of terrace houses in Tropicana Heights, Kajang, and the third serviced apartment block in Tropicana Gardens, which is a mixed residential development located in Kota Damansara.

The property player intends to focus more on development activities within the central region, where it has more than 1,000 acres (404.7ha) of development land, with a potential gross development value (GDV) of RM24.5 billion. It includes the 863-acre Tropicana Aman in Canal City, which has been earmarked for an integrated township with a potential GDV of RM13 billion for which the maiden launch is expected by the end of this year.

Based on its ongoing projects, the group expects to deliver a satisfactory performance in 2014.



This article first appeared in The Edge Financial Daily, on August 29, 2014.