Damansara Realty eyes turnaround by year-end
PETALING JAYA: Damansara Realty Bhd, which has continuously been in the red, is hopeful of turning around operationally by the end of the current financial year ending Dec 31, after registering an operating loss of RM26.86 million last year.
Group CEO Brian Iskandar Zulkarim ( pix) told reporters at a media briefing that the turnaround is expected to be driven by its Integrated Facility Management (IFM) initiative.
Damansara Realty integrated the operations of its non-property subsidiaries – MR Urusharta (M) Sdn Bhd (engineering facilities management services), HC Duraclean Sdn Bhd (cleaning services) and Metro Parking (M) Sdn Bhd (car park management) – under the IFM in a bid to synergise and consolidate its market position, as part of its strategic restructuring plan (SRP).
“We are a group of companies but each company was growing in its own direction,” Brian Iskandar said on the group’s direction prior to the SRP.
“Now we streamline those (businesses) and we make sure that everything that is under the roof of DRB actually synergises with each other.” Damansara Realty recorded its biggest loss in a decade in the financial year ended Dec 31 2016, with a net loss of RM27.73 million on the back of RM183.60 million in revenue. The group continued its run of losses in the first quarter ended March 31, 2017 with a net loss of RM1.34 million, against RM3.86 million in the previous year’s corresponding quarter.
In May, its auditor Messrs Jamal Amin and Partners issued a note to express doubt over the group’s sustainability as a going concern, citing current liabilities as at Dec, 31 2016 exceeding current assets by RM155 million. This came about from a development rights agreement payable to Johor City Development Sdn Bhd on Dec 31, 2016.
Earlier this month, the group announced that its IFM wing bagged a RM26.21 million job from Petroliam Nasional Bhd’s (Petronas) to provide security management services for the Petrochemical Integrated Development (Rapid) project in Pengerang, Johor. This is in addition to a RM124 million facilities management and cleaning services project secured in September.
As part of the SRP, Damansara Realty has also streamlined its property development portfolio.
It has identified four key projects which are in various stages of development, two of which are located in Johor – a township known as Central Park, which is being developed in a 30:70 joint venture with Hong Konglisted Country Garden Holdings Co Ltd, and 40 multi-storey shoplots known as Aliff Square.
The other two are a residential project known as Damansara Hills in Kuantan, Pahang, and a civil servants housing project in Putrajaya.
Damansara Realty is looking to recognise revenue from the sale of units in Aliff Square and Damansara Hills this year.
In addition to that, the group is embarking on strategies to improve corporate governance, which entails forming an executive committee to scrutinise its financial performance, synergising the subsidiaries and keep tabs on the progress of the SRP.