‘RPGT not expected to impact on Sunrise’s sales’

KUALA LUMPUR: The proposed 5% real property gains tax (RPGT) from January next year is not expected to have an impact on the sales of Sunrise Bhd’s properties as the tax is not a substantial amount, said its executive chairman Tong Kooi Ong.

However, Tong said market sentiment has been impacted by the announcement. Speaking at an analysts’ briefing here on Nov 2, Tong said the government should clarify the purpose for reintroducing the tax that was suspended since April 2007.

“What matters most now is the purpose of imposing this RPGT… if it is to increase the government’s revenue, then it’s fine. However, if they are trying to cool down the property market, then we should be concerned because there may be other measures coming out next,” he said.

Tong is also confident that Sunrise, the master developer of high-end developments at Mont’Kiara, will see its revenue for the financial year ending June 30, 2010 (FY2010) surpassing FY2009 with two new projects -- condominium development 28 Mont’Kiara (MK 28) in Mont’Kiara and commercial development Solaris Towers along Jalan Sultan Ismail, which it plans to launch before the end of its financial year.

He believes that the two projects, especially the office towers, will be well received by buyers as unlike other offices in the area, the units will be sold with strata titles.

Sunrise’s FY2009 group revenue grew 17.22% to RM803.9 million, from RM683.8 million a year earlier. Net profit dipped 2.23% to RM156.35 million, from RM159.92 million the previous year.

Meanwhile, on the “say-on-pay” proposal – an unprecedented initiative to get feedback from shareholders on the fairness of compensation to directors – discussed at its AGM on Oct 29, Tong said the developer plans to seek shareholders’ feedback every year.

At Sunrise’s AGM on Oct 29, a “say-on-pay” proposal, in which Tong said would promote greater accountability and transparency, was discussed and a non-binding advisory vote was cast to gauge shareholders’ sentiments on whether directors’ salaries were justified.

To a question on whether the shareholders thought the current compensation for the executive directors was fair, the number of shareholders (present and voted) responding in the positive accounted for 53.06% (holding an 8.2% interest in the company), while 46.94% of shareholders (holding 91.8% interest) said no.

To another question, an overwhelming 66.67% of the shareholders (holding 99.97% interest) said they believed the executive directors were underpaid, while 33.33% (holding 0.03% stake) believed they were overpaid.

A many as 56.12% (holding 99.85% interest) said they would support a 10% rise in the executive directors’ compensation next year, while 43.88% of the shareholders (holding 0.15% interest) disagreed.