KUALA LUMPUR: Construction and property developer, Melati Ehsan Holdings Bhd, which has secured projects worth RM3 billion, remains positive of achieving a profit margin of six per cent this year.
Managing Director Tan Sri Yap Suan Chee said the projects, which are 80 per cent government-related work, could last the company for a decade.
“The projects are mainly for the Selangor State Development Corporation (PKNS) and Public Works Department. Therefore, we do not have any payment problems,” he told reporters after the company’s annual general meeting here today.
Yap said projects, worth RM250 million, involving highways, road construction and several housing development schemes were expected to be completed this year.
The company, he said was waiting for approval for another project in Kelana Jaya from PKNS but declined to reveal the details.
“Once we receive the approval, (which is expected) by the second quarter of this year, we shall start work,” he said.
Besides, Melati Ehsan would also be involved in flood mitigation projects in the east coast, Yap added.
As for its property arm, the company was still optimistic of prospects in the affordable housing segment despite challenges posed by cooling measures introduced by the authorities.
Among the measures introduced by the government were capping maximum personal loan tenures to 10 years and that of property financing to 35 years to mitigate rising household debt.
This appears to have tightened the property financing tap since banks have become more cautious in their loan qualification criteria.
The firm is also actively seeking for new land for future development with focus to be given in areas where it already has a presence, he said.
Melati Ehsan’s balance sheet remained stable with cash amounting to RM36.80 million in its coffers.
As of Aug 31, 2014 its net gearing stood at 9.5 per cent, down from 13.19 per cent previously. – BERNAMA