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Investor CentralMatrix Concepts Holdings Bhd - How much industrial land does it have left for sale?
It seems the developer will easily pass its target of RM 100 mln in industrial land sales this year. But how much land does it have left to sell in Sendayan TechValley?
8/9/2014 - The management of Matrix Concepts Holdings Bhd says it is confident it can sustain its profitability from the sale and launch of current and new development projects.
It is currently focused on its township development projects in Bandar Sri Sendayan in Seremban, Negeri Sembilan, and Taman Seri Impian in Kluang, Johor.
So far, Matrix Concepts has launched its Hijayu 1A Phase 2 and Sendayan MetroPark Shop Phase 2 development projects in Bandar Sri Sendayan, Seremban, Negeri Sembilan.
It has also launched its Impiana Avenue 3 development project in Taman Seri Impian, Kluang, Johor.
It is planning to launch its Hijayu 3A development project in Bandar Sri Sendayan in Q3FY14.
The company just announced earnings for Q1FY14:
Revenue: -13% to RM 134.7 mln
Profit: -16% to RM 38.6 mln
Cash flow from operations: RM 85.6 mln vs RM 9.5 mln
Dividend: 5 sen per share vs 13.5 sen per share
The management of Matrix Concepts said the decline in revenue was partly because its Hijayu 1A Phase 1 project has not yet reached a stage of completion that would allow it to recognise revenue.
The decline in revenue also caused a corresponding decrease in its profit for the quarter.
This contrasts with its performance in Q1FY13, when it managed to complete and recognise the revenue attributable from its Nusari Bayu 3 Phase 2 development as well as recognise revenue from its various on-going development projects.
Investor Central. Asian insights for global investors. We ask the tough questions of Asian companies which global investors need answers to.
1. How much industrial land does it have left for sale?
Analysts such as Kenanga wrote in a report in May that Matrix Concepts felt the impact of no land sales for Q1FY14.
Kenanga said Matrix Concepts is selling a small plot of industrial land for RM 5.2 mln and is in serious negotiations to sell up to another 75 acres of industrial land, which could fetch more than RM 100 mln.
According to the analyst, Matrix Concepts' has an industrial lot sale target of RM 100 mln for the year.
Matrix Concepts sells industrial land in its Sendayan TechValley development to companies interested in setting up in the area.
So far, it has sold land to companies such as Hino Motor, Messier-Buggatti-Dowty and Akashi-Kikai Industry/Daihatsu, bringing over RM 3.1 bln of foreign direct investment to Sendayan TechValley.
It seems Matrix Concepts will easily supersede its target of RM 100 mln in industrial land sales.
It sold a total of 220.4 acres of land in Sendayan TechValley in FY13, according to page 30 of its
back in December 2013, Matrix Concept’s landbanks are largely locked at favourably low prices.
It bought its land in Bandar Sri Sendayan and Taman Seri Impian at an extremely low cost of RM3 per square foot many years ago, before the property boom.
As of December, the broker said the asking price for nearby land in Bandar Sri Sendayan ranges between RM 5.60 and RM 8.00 while land prices around Taman Seri Impian have doubled to around RM 6 per square foot.
Does Matrix still see cheap land in the vicinity of its township in Seremban?
Total number of questions in the full story: 9)
We have invited the company (alex@aquilas.com.my, julia@aquilas.com.my) to an on-camera interview, and/or to reply to our questions in writing.
At the time of publication we have not received a reply (which is why you are seeing this message).
We will update this report if we do.
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