"In an interview with The Sun recently, General Manager of PKNS Othman Omar disclosed that the state owned agency will continue its successful stride this year by closing in sales of around RM800 million. PKNS is recording an average growth profit of 20% annually since 2009!"
Read the interview here:
Selangor State Development Corporation (PKNS) has 29 launches planned for this year and expects to rake in sales of RM800 million, said its general manager Othman Omar.
Last year, it recorded sales of between RM500 million and RM600 million, and net profit of RM319 million with an average profit growth of 20% annually since 2009.
"We also introduced the open tender system in 2009 and achieved bottomline savings of RM115 million in 2010. Last year, we achieved savings of RM100 million and we target the same for 2012," he told SunBiz on Friday.
Othman said the open tender system is one of PKNS' efforts to enhance corporate governance and transparency, and is also part of its rebranding efforts to change the perception on its operations.
"It is a balancing act. Some people say we should be focusing on affordable homes and not build high-end homes to compete with other players but we do not make profit from affordable homes," he said.
He added that affordable and low-cost homes built by PKNS are subsidised with profits from its high-end projects, otherwise it would have to depend on grants from the government."The perception is that PKNS only builds low-cost homes but we have a range of products which will help sustain our profitability and survive any kind of (economic) weather," he said.
He said for low-cost homes, it subsidises between RM20,000 and RM30,000 per unit and up to RM100,000 per unit for affordable homes.
"Our houses are sold at 15% to 20% below market rate," he added.
With some RM20 billion worth of projects in the pipeline for the next seven to 10 years, PKNS is looking to raise RM700 million in a sukuk issuance to fund its new projects and to acquire land.
"The sukuk has been approved but we want better terms, so we're aiming for year-end. Besides, we don't need the money yet as we have RM200 million excess cash from last year," said Othman.
According to him, PKNS is also starting to take on a leading role in its joint venture projects.
"In our newer projects, PKNS is now taking the lead with about 70% share; last time, we used to take 30% to 40% share," he said.
PKNS has 4,856ha of landbank, which would keep it busy for at least 10 years.
"We are also acquiring land for development but our focus now is more on pocket land and reversed privatisation," said Othman.
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