CHHB rides on mid-range porperties to maintain profits

30-06-2006: CHHB rides on mid-range porperties to maintain profits
By Isabelle Francis

Country Heights Holdings Bhd (CHHB) expects to maintain its last year's earnings in the current financial year ending Dec 31, 2006 despite the softening of the property market.

Its managing director Tan Sri Lee Kim Yew said the company would partly leverage on its latest mid-range residential development projects scheduled for launch by year-end.

Those projects will have gross development value of up to RM700 million. It posted a net profit of RM6.66 million in FY05. For the first quarter this year, its posted a net loss of RM13.52 million.

One of the two projects due for launch is a two-storey Villa in Melaka valued at RM300 million and is aimed at embracing the government-initiated Malaysia My Second Home Programme.

The second project, which is due to be launched by September, are sports facilities for its Kolej Height Utara project in Kubang Pasu, Kedah.

Kolej Height Utara is one of its eight mid-range sports-living property development projects, an idea that was mooted by Lee two years ago.

“Now that we have four, we are looking at four more spots. We’re looking at cities like Ipoh, Kuantan, and Temerloh. We believe these 50-acre developments is a winning strategy.

“Mid-range (priced-properties) is Country Height’s strategy in positioning ourselves. Hopefully this concept would expand overseas as well,” said Lee.

He said mid-range properties are priced starting from RM250,000 to RM1 million per unit.

CHHB chief financial officer Choo Chee Beng said it expected to achieve sales of at least RM120 million sales in the current financial year.

He expected property development to continue contributing 35% to its revenue.

On the REITs plans for its Mines International Exhibition and Convention Centre, he said CHHB had received a few offers, involving a five-year guaranteed estimated net yield of about 7%.