AFFORDABLE housing and integrated township developer Lagenda Properties Bhd’s revenue surged by 1,530.9% to RM170.5 mil in 2Q FY2021 from the corresponding period last year while its net profit shot up by 1,559.8% to RM42.9 mil. The higher profit was mainly due to the acquisition exercises which were completed in August 2020.
However, revenue declined 25.4% quarter-on quarter (qoq) as construction activities were delayed by one month due to the full movement control order (FMCO) which led to lower revenue recognition in 2Q FY2021.
Seeing this as a temporary setback, the group envisages to catch-up on construction progress soonest possible. Correspondingly, net profit in 2Q FY2021 decreased by 22.8% from the preceding quarter (1Q FY2021).
“Our results were satisfactory despite the lockdown which delayed construction progress. Stronger sales in 2Q FY2021 demonstrated that demand is still robust for affordable housing,” commented Lagenda’s managing director Datuk Jimmy Doh.
Despite the lockdown, the property developer secured stronger sales in 2Q FY2021 by achieving total sales of close to RM700 mil for 1H FY2021 which represents 70% of its target for 2021.
With this momentum, Lagenda is confident of realising its FY2021 sales target of RM1 bil. “We are aiming to catch-up on construction activities in the coming months when the lockdown eases,” Doh remarked.
In preparation for this and to safeguard the well-being of its workforce, Doh added that 88% of Lagenda’s staff have been vaccinated which is in line with the group’s goal to achieve 100% vaccination in the coming months.
Meanwhile, the group’s unbilled sales stand at RM561 mil as of June 30, providing strong cashflow visibility. In addition, Lagenda declared an interim dividend of 3 sen/share, payable on Oct 5 with the group committed to rewarding its shareholders by paying out 25% to 30% of its profits as dividends.
“We believe our business model is highly scalable and we plan to expand our business blueprint outside Perak, across more states in Malaysia,” Doh pointed out.
“Our immediate targets are Kedah, Pahang and Johor. As Lagenda continues to build more houses, we aim to achieve higher and better efficiency on every township as we replicate based on previous framework.”
With its recent land acquisitions in Pahang and Johor, Lagenda’s total gross development value (GDV) is now circa RM9 bil.
“This will ensure that we are able to launch one new township per year to deliver long term sustainable growth,” Doh concluded.
At the close of trading yesterday, Lagenda was up 1 sen or 0.80% to RM1.26 with 495,000 shares traded, thus valuing the company at RM1.03 bil – Aug 18, 2021
