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Saturday, March 8, 2008

Encorp wants to venture into Asia, Mideast

PETALING JAYA: Having made its mark in the prefabricated building technology locally, Encorp Bhd is ready for its maiden foray overseas and has set its sights on projects in Asia and the Middle East.

It was negotiating to undertake homes, government quarters and commercial building projects in several countries in the two regions, said group chief executive officer Yeoh Soo Ann.

He said Encorp's reputation in designing, financing and constructing 10,000 teachers' quarters in Malaysia using the industrialised building system positioned the company well to seek overseas ventures that used such technology for mass housing projects.

Yeoh Soo Ann

“We will go where the returns are operationally and financially viable after taking into consideration the political and currency risks of that particular country and/or region,” he told StarBiz.

On when it expected to conclude talks, Yeoh said it hinged on due diligence and feasibility studies.

He said Encorp was also aggressively pursuing opportunities presented by the Ninth Malaysia Plan (9MP).

“We are looking at several projects in the 9MP, with a total value estimated at RM2bil. They are currently at tender and/or negotiation stage,'' he said.

Encorp returned to the black in the financial year just ended Dec 31 (FY07) with net profit of RM69.88mil against losses of RM124.84mil in FY06. Revenue more than doubled to RM327.74mil from RM143.13mil a year earlier.

Yeoh believes that the company was poised for growth and better financial results.

With Encorp's stable financial standing, coupled with successful sales of existing projects, it is scouting around for land that could yield higher returns.

“We do not fancy having a huge land-bank as that will also mean having to carry the cost over a longer term,” Yeoh said

Encorp was also looking into potential partnerships and joint ventures with property developers and landowners, Yeoh said, adding that talks were ongoing with several potential partners, locally and abroad.

An artist's impression of The Strand Damansara

He said the group was optimistic its property division would continue to enhance profits in the future. Meanwhile, plans have been finalised for the launch of serviced apartments and small office, home office phases of The Strand, Damansara later this year, followed by the Shopping Mall at The Strand.

“We are expecting sizeable recurring income from the rental of the mall when it is completed in 2010,” Yeoh said.

Encorp will also launch the Section U10, Shah Alam development this year. With a gross development value of RM300mil, the integrated eco-concept gated community project is expected to be completed by the second quarter 2010.

By The Star - StarBiz - (by Chan Ching Thut)

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