JS Land suffers net loss in Jan-Jun
REAL estate developer JS Land Plc listed on the Cambodia Securities Exchange (CSX) Growth Board reported a total comprehensive loss of 2.363 billion riel ($590,750) in the first half ended June 30, 2022 due to low demand for condominium units.
In its bourse filing on August 31, JS Land showed no revenue for the period, as it has not handed over its Garden Residency 2 (GR2) project, which is currently under construction and is expected to be completed in 2023.
JS Land chairman Koy Le San told shareholders that as a property development company, the terms and conditions stipulated in the sales and purchase agreement allow the company to recognise revenue once the property is completed and handover.
This, he said, was in accordance with the requirements of International Reporting Standards.
“Hence, from now till the handover of GR2, our company’s audited account will not reflect any revenue. Nevertheless, you will see that the company’s property development assets are increasing on a quarterly basis to reflect the stage of project completion to date,” Le San added.
For the second quarter ended June 30, 2022, JS Land showed a net loss of 744.141 million riel.
Revenue for the company, which raised $12 million from its initial public offering in February, is derived from sale of condo units and other income.
In a statement, the firm noted that the current situation of “apparent
oversupply of condominium” may result in “property overhang or unsold properties” as well as a downward pressure on the price of its current development project. This, it said, is likely to “adversely” affect its sales and profitability.
“We seek to lower the risk of holding unsold properties by launching presale events to attract early bird buyers with attractive selling price
and payment options.
“We believe our various options of payment scheme not only help attract the interests of buyers but also reduce the cancellation rate which [could] contribute to lowering the risk of property overhang,” JS Land stated.
In addition, the company related that prior to acquiring and developing any land bank, the company conducts a feasibility study to determine
the potential demand of properties by considering market supply and demand, budget and estimated costs of construction, comparable projects, potential pricing of the properties, existing and/or potential competitors developing in the vicinity of the site.
At closing, JS Land remained unchanged at 3,890 riel for a market capitalisation of 100.01 billion riel.