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Tuesday, December 18, 2007

Ekovest profits from Danga Bay in 2009

Acquisition of project will be completed by then

KUALA LUMPUR: Construction firm Ekovest Bhd says it will only see earnings from property development in the financial year ending June 30, 2009, when the acquisition of Danga Bay Sdn Bhd, the developer of Danga Bay in Johor, is completed.

Ekovest executive vice-chairman Datuk Lim Kang Hoo said the company expected to complete the acquisition of Danga Bay by the middle of next year.

“For the current financial year our earnings will still be from construction where we mostly do design and build projects for the government,” he told reporters after the company's AGM yesterday.

In July, Ekovest announced that it was acquiring Danga Bay, together with 240 acres of freehold land, for RM1.1bil from Lim, who owned the project in a personal capacity. “The land is near Johor Baru and is on the waterfront with a 3km stretch of beach,” he said.

Contribution from property development would depend on how the feasibility studies turned out and how fast the Danga Bay acquisition could be processed, Lim said.

The company's net profit for FY07 had more than doubled to RM17.42mil from FY06 due to higher turnover from its construction activities, he said. Revenue for FY07 came in at RM356.60mil.

Lim said once the acquisition was completed, there would be an initial launch, comprising serviced residences and villas. “The basic infrastructure is there, Ekovest will be taking over the project as it is,” he said.

On the company's landbank in the Klang Valley, Lim said announcements would be made when feasibility studies were completed. Ekovest has about 16 acres, both freehold and leasehold, located in various parts of the central Klang Valley. It also has 25 acres of freehold land in Pulai, near Johor Baru.

Lim said the company's current construction order book, comprising three projects, was enough to last it for three to four years. Ekovest's construction jobs in hand include the Duta Ulu Kelang Expressway, the second phase of Kolej Universiti Teknologi Tun Hussein Onn and a 60:40 joint venture with Faber Group Bhd to construct a National Institute for Natural Products, Vaccines and Biology complex in which it is the junior partner.

“We intend to bid for projects not only in the Iskandar Development Region but also elsewhere in the country. We're not interested in bidding for overseas projects unless there are very good offers,” he said, adding that the company had a highway construction project in India in 2002.

By The Star (by Fintan Ng)

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