SHL sees profit rising on strong take-up of projects

SHL sees profit rising on strong take-up of projects
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KUALA LUMPUR: SHL Consolidated Bhd sees improved profit for the current year ending March 31, 2008 (FY08) on strong take-up of its recently launched property projects outside Kuala Lumpur.

The group also expects to realise the bulk of its earnings from previously sold properties under the build-then-sell (BTS) concept.

“We see rising contribution from these ongoing projects in the coming quarters,” director Jack Wong told reporters after the group AGM yesterday.

In February, the group launched its maiden project Alam Budiman in Shah Alam, comprising 1,800 units of properties on a 150-acre mixed development township.

The project has a gross development value of RM430mil.

So far, a total 720 double-storey houses valued at RM250mil have been offered over two phases.

According to Wong, the first phase of 420 houses was 60% sold, while nearly half of the 300 units in the subsequent launch in late June was taken up.

To capture the growing demand for landed properties, SHL plans to start selling 150 double-storey terrace houses at its flagship development, Bandar Sungai Long, in Cheras.

The houses are priced from RM300,000.

“The response for both projects is encouraging so far,” Wong said.

Meanwhile, SHL owns 87 acres in Rasa north of Rawang in Selangor, which had been earmarked for future development.

In the more immediate term, the company has teamed up with Tan & Tan Developments Bhd to develop a high-end condominium project in Kuala Lumpur city centre.

For the year just ended, SHL registered a net profit of RM15.56mil, or 6.9 sen per share, on revenue of RM155mil.

It was the second consecutive annual decline since net earnings hit a record RM45.4mil, or 18.7 sen per share, in FY05.

But despite a slow start this year, net profit in the first quarter ended June 30 fell by almost half to RM3.5mil from RM6mil a year ago. It expects the earnings kicker for the year to come in during remaining quarters.

SHL adopts a BTS concept for its projects, which basically means that the company would only receive the bulk of the payment once the property is completed.