Residential projects lift Ibraco earnings

KUCHING: Property developer Ibraco Bhd, which has proposed a bonus issue following the completion of a fund raising exercise recently, has chalked up improved quarterly earnings.

In the second quarter ended June 30, 2015, Ibraco group’s net profit surged to RM8.4mil from RM5.9mil in the previous corresponding period despite lower revenue of RM52.2 mil against RM56.4mil previously. Earnings per share rose to 6 sen from 4.5 sen.

The company said in the quarter under review, the revenue was derived mainly from the sales of residential houses at its flagship development – Tabuan Tranquility, Stutong Heights apartment units, Bintulu Town Square three-storey shophouses, a construction project and rental incomes from investment properties.

Over a six-month period, Ibraco recorded group’s net profit of RM21mil, up from RM12.6mil a year ago although revenue had dropped to RM109.3mil from RM115.4mil.

On the proposed bonus issue, Ibraco will allot some 70.92 million shares on the basis of two bonus shares for every five existing shares to reward shareholders. The bonus issue will be capitalised from the company’s share premium reserve and retained earnings account which stood at some RM8.88mil and RM115mil respectively as at June 30, 2015.

The company has also proposed the sub-division of every one existing share of RM1 held after the proposed bonus issue into two ordinary shares of 50 sen each and one existing redeemable cumulated reference share of RM1 each into two shares of 50 sen each.

“The proposed sub-division will improve liquidity and affordability of the shares as a result of the increase in the number of sub-divided shares to appeal to a larger group of investors.

“Existing shareholders will also be rewarded through having a larger number of ordinary shares while maintaining their percentage of equity interest,” Ibraco said in a filing with Bursa Malaysia.

On completion of the bonus issue and share sub-division expected in the next quarter, Ibraco’s issued and paid-up capital would be increased to some RM248.2 million comprising 496.4 million shares of 50 sen each.

On Aug 21, Ibraco completed its renounceable rights issue of some 50.65 million new shares at an issue price of RM1 each on the basis of two rights shares for every five shares held. The exercise raised gross proceeds of RM50.65mil.

From the proceeds, the company will use RM30mil to repay bank borrowings which stood at RM100.3mil as at Dec 31, 2014. Another RM19.6mil is set aside to finance a proposed mixed commercial-cum-residential project in Kuala Lumpur, Ibraco’s first project outside Sarawak, and the remaining RM1.1mil to pay for the expenses of the rights issue.

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Business , East Malaysia , ibraco


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