Scientex Bhd, a major stretch film producer which has gone big into property development, has mixed property offerings to mitigate a potential slowdown in the sector, said managing director Lim Peng Jin. It has projects worth RM2.1 billion in outstanding gross development value (GDV).
Scientex has offerings in the affordable segment, a category major developers such as S P Setia Bhd and Mah Sing Group Bhd are shifting into in view of the larger untapped demand there.
The company’s volume products in Pasir Gudang and Kulai in Johor, said Lim, feature affordable double-storey terrace houses within the price range of RM110,000 to RM150,000 a unit.
Scientex saw operating profit contribution from its property division overtake its manufacturing unit for FY11 ended July 31. Property contributed RM62 million or 63% of the group’s total operating profit of RM97.4 million with the remaining RM35.4 million from the manufacturing of stretch film and strapping band.
This came despite property contributing less to the group’s total revenue. Revenue from the property unit made up 27%, or RM218.56 million, of Scientex’s total revenue of RM804.02 million. This translated into an operating profit margin of 44.5% for Scientex’s property business, which is considered lucrative given its wide offerings between high-end and volume products.
Scientex’s net profit for FY11 rose 28% to RM77.25 million from RM60.32 million a year earlier, while revenue increased 15.7% to RM804.02 million from RM694.82 million. Earnings per share rose to 35.9 sen from 28 sen previously.
The company has a relatively healthy balance sheet, with virtually zero net gearing as at July 31, 2011. Cash flow remains strong with net cash generated from operating activities rising 41.4% to RM110.53 million for FY11 from RM73.14 million a year earlier.
Scientex has offerings in the affordable segment, a category major developers such as S P Setia Bhd and Mah Sing Group Bhd are shifting into in view of the larger untapped demand there.
The company’s volume products in Pasir Gudang and Kulai in Johor, said Lim, feature affordable double-storey terrace houses within the price range of RM110,000 to RM150,000 a unit.
Scientex saw operating profit contribution from its property division overtake its manufacturing unit for FY11 ended July 31. Property contributed RM62 million or 63% of the group’s total operating profit of RM97.4 million with the remaining RM35.4 million from the manufacturing of stretch film and strapping band.
This came despite property contributing less to the group’s total revenue. Revenue from the property unit made up 27%, or RM218.56 million, of Scientex’s total revenue of RM804.02 million. This translated into an operating profit margin of 44.5% for Scientex’s property business, which is considered lucrative given its wide offerings between high-end and volume products.
Scientex’s net profit for FY11 rose 28% to RM77.25 million from RM60.32 million a year earlier, while revenue increased 15.7% to RM804.02 million from RM694.82 million. Earnings per share rose to 35.9 sen from 28 sen previously.
The company has a relatively healthy balance sheet, with virtually zero net gearing as at July 31, 2011. Cash flow remains strong with net cash generated from operating activities rising 41.4% to RM110.53 million for FY11 from RM73.14 million a year earlier.
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