LITTLE is known about Lagenda Properties Bhd, but the Perak-based firm is one of the most profitable property developers listed on Bursa Malaysia. With a market capitalisation of RM1.24 billion, it is in the ranks of high-end developers such as Eco World Development Group Bhd and Tropicana Corp Bhd.
According to its group managing director Datuk Jimmy Doh Jee Ming, the transformation of Lagenda — formerly known as DBE Gurney Resources Bhd — was completed in August last year.
Following the emergence of the Doh family as new major shareholders, the poultry business of DBE has been sold back to the Ding family, the previous owners who had gradually exited the company. Today, Lagenda is a pure-play property developer specialising in affordable housing.
“To me, this is only the beginning. Today, our presence is mostly in Perak. We still have so many other states to go into,” Doh tells The Edge in a virtual interview.
“Kedah is next. We hope to launch a few township projects there. The B40 (bottom 40% income group) market is huge. Our numbers can get even better in the coming years.
“Our sales target is RM1 billion for this year, and we hope to achieve 20% to 30% more on a yearly basis. We are quite certain that we can sell about RM300 million each for our three township projects.”
Lagenda’s net profit increased 18 times year on year to RM140.9 million in the financial year ended Dec 31, 2020 (FY2020). Excluding one-off expenses for corporate exercises and other non-operational expenses, the group generated an operating profit of RM185 million last year.
Considering that Lagenda’s affordable housing projects have largely escaped the brunt of the Covid-19 pandemic and the Movement Control Order (MCO), Doh is confident that the group can maintain its growth momentum and that its financial performance will be reflected clearer and better in FY2021.
“Based on our projects in the pipeline, Lagenda should be able to generate profit growth for years to come. On average, we are talking about RM50 million in operational profit on a quarterly basis. Due to the accounting standards disclosure requirements, there may be some variance,” he says.
Lagenda has two ongoing major township developments in Perak — Bandar Baru Setia Awan Perdana and Lagenda Teluk Intan. This year, the group plans to launch its third township project in Tapah, on land that it purchased from UEM Sunrise Bhd last year.
Lagenda plans to launch its fourth township project in Sungai Petani, Kedah, next year. Moving forward, all of its projects will carry the Lagenda name, so the newest developments will be called Lagenda Tapah and Lagenda Sungai Petani.
“The project in Sungai Petani is a joint venture with Bina Darulaman Bhd, where they are the landowner and we are the developer. We do not purchase the land outright. This is favourable to us as it means less upfront capital investment and better cash flow management,” Doh explains.
Ideally, Lagenda plans to launch one township project a year, with a gross development value (GDV) of RM1.5 billion to RM2 billion, which should keep the group busy for the next five years, he adds.
https://theedgemalaysia.com/article/lagenda-properties-out-make-name-itself
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