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Wednesday, September 21, 2011

Bolton launching projects worth RM3b

Market-listed property developer, Bolton Bhd, will be launching projects with a gross development value (GDV) of RM3 billion over the next 12 months.

Executive Director Chan Wing Kwong said for the current financial year ending March 31, 2012, the group has three projects to be launched with a total GDV of RM1 billion.

"We have also received preliminary approval for our proposed revision to the development plan of the 1.74 hectare Jalan Mayang land in the KLCC area, which we plan to launch next year," he told reporters after the group Annual General Meeting here, today.

He said the project will be a mixed commercial development with an estimated GDV of RM1.8 billion.

Chan said the group is still considering more land acquisitions while looking for potential joint venture development opportunities.

"We have to continue to push the envelope in terms of creativity and innovation with regard to product range, marketing strategy, business development and customer service," he added.

For the financial year ended March 31, 2010, the group posted a lower pre-tax profit of RM20.3 million as compared to RM50.7 million previously, while revenue was down to RM243.8 million from RM257.5 million.

The decline in pre-tax profit was due to one-off charges, namely, the mark-to-market losses on quoted securities of RM6.5 million and higher marketing expenses of RM17.6 million incurred due to the record sales performance achieved during the year.

Bolton's Executive Chairman Datuk Azman Yahya considers the lower earnings to be an anomaly, as when the group begins to deliver on its projects, it will be reaping the benefit of higher profits.

"Our comprehensive income for the year was RM31.8 million. Of equal importance is that we amassed RM64 million cash from our operation, which put us in a firm position to sustain our growth plan," he said.

The group recorded RM586 million in sales, the highest in its 47-year history, representing a 125 per cent increase over the RM260 million achieved in the last financial year, with unbilled sales of RM484.6 million as at March 31, 2011.

By Bernama

Bandar Raya's asset sale may face shareholder hurdle

KUALA LUMPUR: Bandar Raya Developments Bhd (BRDB) may have a tough time convincing minority shareholders to approve a major asset sale as the offer was below book value and it is not using the bulk of the proceeds to replenish land.

On Monday, BRDB agreed to accept a RM914 million offer from major shareholder Ambang Sehati Sdn Bhd to buy four properties from the group. The assets have a book value of RM942 million.

"For BRDB to monetise their assets, it is fine to sell if the price is right or at attractive levels. But we think it might be tough for BRDB to get its minority shareholders to approve the deal," an analyst with OSK Investment Bank told Business Times.

Ambang Sehati is buying CapSquare Retail Centre, Permas Jusco Mall and all of BR Property Holdings Sdn Bhd, which owns Bangsar Shopping Centre (BSC) and Menara BRDB.

Ambang Sehati, which owns 18.8 per cent of BRDB, is controlled by Datuk Mohamed Moiz Jabir Mohamed Ali Moiz, who is chairman of the property firm.

It proposes to pay a preliminary cash payment of RM430 million and assume RM484 million in liabilities related to BSC and Menara BRDB.

Following the proposed disposal, BRDB plans to distribute RM390 million from the assets sale to shareholders via a net cash dividend of 80 sen apiece, and use RM302 million to pare down debt.

AmResearch thinks the money could have been put to better use.

"While the proposed dividends are attractive for minority shareholders, we believe the cash proceeds are better off deployed for landbanking purposes or to fund its future developments, especially when its property development unit has been lacklustre due to delay in launches," it said in a report.

OSK has downgraded BRDB from "buy" to "trading buy" and increased the target price from RM3.06 to RM3.14 effective yesterday, taking into account the special dividend.

AmResearch, meanwhile, is reaffirming its "hold" rating on BRDB with fair value unchanged at RM2.45 a share.

Shares of BRDB fell 14 sen to close at RM2.24 yesterday.

By Business Times

China boost for affordable homes

BEIJING: Chinese Premier Wen Jiabao pledges to allocate more government funds to build cheap homes for low-income households and urges banks to lend more for the construction of state-subsidised housing.

China has built 8.68 million units of homes for rental or sale to poor families as of the end of August this year, putting it on track to fulfil its full-year goal of 10 million homes.

“We have made good achievements in affordable housing construction in recent years,” Wen told a cabinet meeting on Monday.

By Reuters

US housing starts slow in August

US housing starts fell in August for a second straight month, another sign of the weakness of the American economy, the US Department of Commerce said Tuesday.

Builders started new homes at an annual pace of 571,000 units, down from 601,000 in July and 615,000 in May. It was also slightly lower than the pace for the first half of the year.

However, in a promising sign -- though from a less reliable indicator of the economy's health -- building permits issued in August jumped to an annual rate of 620,000, up from 601,000 in July and 606,000 in June, the department said.

The construction industry, one of the key pillars of the economy, has remained in a deep slump since the 2008-2009 recession, with ultra-low interest rates failing to give a boost to the sector.