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Thursday, February 10, 2011

Astral units plan mixed property development

ASTRAL Asia Bhd's units, Syarikat Ladang LKPP Sdn Bhd and Tasja Development Sdn Bhd, had signed a joint venture agreement to develop land in Pahang into a mixed property development.

In a filing to Bursa Malaysia yesterday, Astral said the 599.41ha leasehold project would comprise a commercial centre, an industrial centre, a mixed residential designs, public amenities and infrastructure.

Astral said the project incorporated a high-tech park to be named - Kuantan Hi-Tech Park.

It said upon the implementation of the proposed joint venture, the business of Astral would be diversified to include property development.
Astral is principally engaged in the cultivation of oil palm, civil engineering and construction works and property development.

By Bernama

Axis-REIT to offer reinvestment option

AXIS-REAL Estate Investment Trust Managers Bhd (Axis-REIT) has become the third listed company and the first real estate investment trust (REIT) to offer the option of new units in the REIT as dividend payment.

In an announcement to Bursa Malaysia yesterday, the company said it will seek unitholders' approval to offer a reinvestment plan, giving unitholders the option of a cash payout, new units or a combination of cash and new units (electable portion).

It proposes to issue new units of up to 20 per cent of the current fund size of Axis-REIT of 375.9 million units.

This comes after Malayan Banking Bhd and AMMB Holdings Bhd announced similar plans last year.
Maybank's reinvestment plan was dubbed a success, enticing some 80 per cent of shareholders to reinvest in the financial institution, while AMMB's plan is yet to be issued.

Axis-REIT shares fell 0.01 sen yesterday to close at RM2.40.

Bloomberg Consensus shows that eight of research firms have a "buy" call on the stock, while four recommend a "hold". Its average target price is RM2.60.

"Placements are restricted to a pool of investors, and we don't do rights issues because it's dilutive in nature, so the reinvestment plan seems (to be) a very fair way of distributing units to our investors," Axis-REIT Managers Bhd chief executive officer Stewart LaBrooy told Business Times yesterday.

The cash secured from the reinvestment plan will help bolster the REIT's borrowings-to-total assets ratio, which could breach 35 per cent, in view of future acquisition plans.

While there is no rule to specify it, syariah-compliant REITs' debt-to-asset ratio has generally hovered between 30 and 35 per cent.

The total amount of income distribution to be declared, the size of the electable portion and consequently, the maximum number of new units to be issued under the proposed income distribution reinvestment plan would depend on the financial performance and cash flow position of Axis-REIT, and prevailing economic conditions.

"It's a much easier, nicely well- managed way to manage our debt- to-asset ratio," LaBrooy said.

The exercise will also help make the stock more tradeable.

While the issue price of the new units has a 10 per cent discount cap to the average market price prior to the price-fixing date, Axis-REIT has traditionally accorded discounts of between 4 and 5 per cent.

By Business Times

MRCB Q4 profit rises on better margin

KUALA LUMPUR: Malaysian Resources Corp Bhd (MRCB) registered a net profit of RM41.5mil for the fourth quarter (Q4) ended Dec 31, 2010, more than tripling its RM12.4mil net profit posted in the same period last year.

It told Bursa Malaysia that the higher profit was due to improved margin coupled with advanced stage of activities of its engineering and construction works and property development projects at Kuala Lumpur Sentral.

“Higher operational margin was achieved on the back of crystallisation of its ongoing value engineering and efficient project supervision and cost-saving initiatives,” it said.

Its revenue for Q4 stood at RM433.1mil, 53.8% higher than RM281.7mil previously.

MRCB has recommended 1.5% or 1.5 sen per share first and final dividend for the financial year ended Dec 31, 2010 (FY10) less 25% income tax, amounting to about RM15.6mil.

For FY10, MRCB posted a net profit of RM67.3mil, a 94.3% more than RM34.6mil in the FY09. Its revenue rose from RM921.6mil to RM1.07bil.

By The Star