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Thursday, July 31, 2008

Crescendo sees more profit from industrial properties

PETALING JAYA: Johor-based property developer Crescendo Corporation Bhd expects industrial properties to be its main profit generator for the current financial year ending Jan 31, 2009.

Crescendo managing director Gooi Seong Lim said the industrial property arm could contribute at least 60% of its profits in FY09 and much of the appeal of its industrial properties lay in its location in Nusajaya, which is part of the multi-billion ringgit regional development, Iskandar Malaysia.

Industrial properties contributed nearly 50% to the group’s profits in FY08.

“The Nusajaya area is located only 10 minutes from Tuas Singapore through the second link; so the take-up rate is quite good due to relocation from higher costs area in Singapore to Malaysia, which is cheaper,” Gooi said after the company’s AGM here yesterday.

Crescendo is now in the midst of building the second phase, which consists of about 40 units, of the Nusa Cemerlang Industrial Park in Nusajaya. The second phase is targeted for completion next March.

“The factories are in the early stages of building and enquiries have been encouraging. The whole (Nusa Cemerlang Industrial Park) project consists of 382 (factory) units.

“There are still a few phases to go. Package 2 is going to be officially launched in August this year and is already having some sales,” Gooi added. The first two phases have a gross development value (GDV) of about RM200 million.

He said profit projections for FY09 was looking bright for the group, as it had locked in unbilled sales, mainly from industrial properties, of some RM113 million as at June 30. “We still have 200 completed residential units on sale now with a GDV of RM40 million,” Gooi added.

For the three months to April 30 this year, Crescendo posted a net profit of RM7.3 million on a RM45.7 million revenue, which is an improvement of 82% and 105% respectively, from a year earlier.

Gooi added that the group was not looking at acquiring more land as it already had about 3,200 acres (1,295 hectares) in strategic locations in Johor, of which 1,900 acres are in Iskandar Malaysia.

By The EDGE Malaysia

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