KUCHING: Naim Holdings Bhd (Naim) is taking steps to bring the group back into a healthy position again by introducing a five-year recovery plan which includes a focus on the development of medium affordable and enhance high-end property, possible sale of non-core assets, and others.
It has been a challenging few years for Naim as unforeseen circumstances such as difficulties faced during the development of its MRT stations project, and the challenging property market, beleaguered the group’s performance.
Nevertheless, in its Annual Report 2017, Naim revealed a five-year recovery plan starting this year until 2022, which serves as a roadmap for the group to strategically realign itself into healthy position.
“Realising that we must not let history repeat itself and for the sake of the group’s survival, we have formulated a five-year’s recovery plan (which is 2018 to 2022) as a roadmap and a fresh start for the group to move ahead,” it said.
Some of the main factors the group aims to focus on is the medium affordable and enhance high end property.
It explained, “We have reviewed and will continue to review our strategic direction by focusing on medium affordable house (below RM500,000) and at the same time, enhance the saleability of our high end products.
“To serve these two segments better, we will have two separate segments, each catering specifically for our medium affordable and high end products, which are Naim Affordable Homes unit and Naim Signature Collection unit.
“Although there will be two different segments for difference customers group, please be assured of our continued commitment to deliver great quality service and value to all our customers, as what we have practised all this while.”
It also aims to improve its construction segment. It added that it is also focusing to complete the current jobs on hand within schedule and within budget.
“We will also continue to collaborate with reputable joint venture (JV) partners for large projects, such as what we have done for the Pan Borneo Highway Project with Gamuda,” it said.
Another plan it noted on was a possible sale of non-core and other assets.
While no details were mentioned on which assets it is looking to dispose, it said, “We continuously review the performance of our assets and consider possible sale of non-core and other assets for working capital and to reduce our debts.”
For 2018, Naim commented that the property market could remain challenging due to factors such as rising costs of doing business, increase in cost of borrowings due to an expected rise in OPR, increased competition and property stocks, stricter lending policy and continued weak buying sentiment.
Nevertheless, it said, it will continue to focus on its three flagship developments, namely Naim Bintulu Paragon integrated development (Naim Street Mall, Naim Small Office Versatile Office and Naim ‘The Peak’ condominium), Naim Kuching Paragon integrated development (Naim Sapphire condominium) and Naim SouthLake Permyjaya integrated township development (a range of landed residential properties) in Miri.
“Generally, we will adopt a more cautious approach towards product launches in 2018 by launching a range of mid-end and affordable products and scheduling these launches based on market dynamics,” it noted.
Aside from that, it said it would strengthen its leasing functional unit in an effort to secure tenants for our unsold commercial properties for recurring income in the short term, pending sales. It added that the unit would also assist property investors in sourcing for potential tenants.
As part of its long term plans, it said it would continue to seek opportunities to acquire strategic land banks in Sarawak, Sabah and Peninsular Malaysia to further strengthen the growth of its property segment in terms of sales, profit and market share.
“The slowdown in the economy, which is expected to continue in the next few years, could also give rise to the opportunity in acquiring land at bargain prices,” it added.
It also commended the state government’s initiatives in boosting its digital economy as it could lead to greater global outreach, job creation and increase in business opportunities.
Aside from that, Naim noted that its total outstanding construction order book is at circa RM2 billion which expected to sustain its short term and medium term earnings growth.