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Wednesday, June 3, 2009

MRCB: We can bring down debt gradually

MALAYSIAN Resources Corp Bhd (MRCB) said it can manage its high debt level and expects to gradually cut it over the next few years as it wins more work and sells more properties.

The group's total debt of RM1.6 billion is almost triple its shareholders' equity.

MRCB group managing director Shahril Ridza Ridzuan said the high gearing has always been a matter of concern to the group.

"We currently have an order book of RM2 billion which should double by year-end and and this can help bring down our gearing to 0.5 times," Shahril told reporters in Kuala Lumpur yesterday after the company's annual general meeting.

MRCB chief financial officer Chong Chin Ann said the group's actual gearing is 0.5 times but ballooned to 2.5 times partly due to the Eastern Dispersal Link highway project in Johor Baru and some other office projects.

"By excluding the highway project, the debt will come down by RM540 million and will improve our gearing," said Chong.

The Eastern Dispersal Link and the Permai Psychiatric Hospital, also in Johor Baru, are worth RM1.2 billion.

In the first quarter ended March 2009, MRCB which is a builder and one of the country's biggest providers of office space, returned to the black when it made a net profit of RM153,000 compared to a net loss of RM57 million in the whole of last year.

Meanwhile, Shahril said the future of MRCB is bright with various projects lined up for completion.

This includes Jalan Duta-Ulu Klang Expressway, the Eastern Dispersal Link highway project and a multitude of projects at its flagship Kuala Lumpur Sentral.

At Kuala Lumpur Sentral, there are nearly 5 million sq ft of space under development right now in terms of offices, retail and serviced apartments, a new mall and a campus, among others.

By Business Times (by Zaidi Isham Ismail)

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