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PETALING JAYA: Property developer Tropicana Corporation Bhd is focusing on laying the groundwork to strengthen its foundation to see it through the next growth phase.

The group plans to introduce new developments and phases across its signature Tropicana townships this year amounting to a gross development value (GDV) surpassing RM2.0bil.

A key highlight will be the launch of the group’s maiden development, Tropicana Grandhill. Situated 3,000 ft above sea level, this 112-acre township with a potential GDV between RM12bil and RM15bil will be its first township development in Genting Highlands.

Based on the master plan, this highland city is expected to usher a new trend of holistic and health-centric resort living lifestyle. The first phase of Tropicana Grandhill will be the TwinPines Serviced Suites with over 1,400 units of serviced apartments.

Another new launch will be Shoppes & Residences (South), a mixed development comprising retail lots and serviced apartments at Tropicana Metropark, Subang Jaya.

Also upcoming launches are the landed residential phases at Tropicana Aman, Kota Kemuning; the sixth residential and commercial phase at Tropicana Heights, Kajang; Tropicana Miyu condominiums at Jalan Harapan, Petaling Jaya; as well as shop offices at Gelang Patah, Johor.

With the completion of the corporate exercise in November 2019, the group’s landbank increased to 1,754.1 acres with a total potential GDV of RM61.5bil, along with the joint development agreements for 1,235 acres of land with a potential GDV of RM4.8bil.

Looking ahead, the group will continue to stay focused on being market-driven in its product offerings while unlocking the value of its land bank in strategic locations in the Klang Valley, Genting and the southern region of Peninsular Malaysia.

Meanwhile, Tropicana recorded revenue of RM365mil for Q4 2019, a drop of 38.5% from the corresponding quarter in 2018. The lower performance was attributed to lower progress billings across some of the group’s key on-going projects and lower sales given the challenging property industry.

The disposal of a parcel of freehold development land for RM143mil in the corresponding quarter in the preceding year also contributed to higher revenue in that quarter.

The group’s profit before tax (PBT) rose by 107.9% to RM272.7mil as compared to the RM131.2mil achieved in the same period a year ago.

The spike in PBT was a result of the recognition from the negative goodwill which arose when Tropicana acquired development land held by twelve acquiree companies from a related party at an average discount of 13.4% to the market value of these lands where the completion of this corporate exercise was in November 2019.

Correspondingly, its net profit surged 354.4% to RM233.9mil in Q4, 2019 from RM51.5mil in Q4, 2018. For the year under review, lower sales and progress billings across projects in the Klang Valley and the southern region led to the decrease of 31.5% in Tropicana’s revenue, from RM1.1bil compared to RM1.6bil in the preceding year.

Nonetheless, the group’s PBT increased by 19.6% from RM320.2mil in 2018 to RM383.1mil in 2019 due to the recognition of the negative goodwill after the completion of the corporate exercise in November 2019. Net profit jumped by 97.5% to RM335.8mil in 2019 from RM170mil in 2018.

News Source: StarProperty, 28th February 2020.

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