Jiankun confident of turnaround this year

June 19, 2018 | By | Reply More

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KUALA LUMPUR: Jiankun International Bhd is confident of returning to the black in this financial year ending Dec 31, 2018 (FY18) after missing its target last year, as most of its expenses will be significantly reduced this year, and revenue supplemented by by its two property projects.

The projects are Bayu Heights 2 at Seri Kembangan and Amani Residences at Bandar Puteri Puchong.

Managing director Datuk Lee Kian Seng explained that it should be able to turn around in FY18 as it charged out major costs on marketing and selling commission last year.

Jiankun has been in the red since FY14. Last year the management expected the group to be profitable in FY17 but it still posted a RM3.55 million net loss mainly due to the new launches that were at preliminary stages of construction and had yet to contribute significantly to the group’s performance, while marketing expenses, in terms of commissions to sales staff, were high at RM9.68 million.

Lee, who was speaking after the group’s AGM today, explained that the previous management thought they would be able to amortise commission based on progress of work, however auditors disagreed, and a big chunk of expenses were charged out last year when the project was completed.

Bayu Heights 2 is a three-storey terrace house project with all 84 units taken up. The group expects to deliver this project this year. Amani Residences is a high rise service apartment project, currently in construction stage (20% completed) and has garnered sales of over 70%. Its completion is expected in 2020.

Lee said it is in the midst of getting another landed property project in Selangor, with the completion of Bayu Heights 2.

“We’re still waiting for the proceeds from Bayu Heights 2 this year. Once money is in, we will look at a new project again. Jiankun’s size is small for us to get so many projects at the same time,” said Lee.

He added that Jiankun plans to look for land in the outskirts of Selangor and is also looking at opportunities in the industrial segment.

Meanwhile, he said it will retain Jiankun’s 14 units of shop lots in Huizhou, Huiyang, China, until it gets a good price for them.

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