Bina Puri hopes to see 50-50 contribution between property, construction in 5 years
KOTA KINABALU: Bina Puri Holdings Bhd (Bina Puri) believes that property development can be another core segment in its business in the next five years, next to its current core expertise in construction.
Executive director Matthew Tee said this in a recent briefing held with the media on the group’s latest development in Sabah’s capital city.
He added that given current favourable environment, the property segment was poised to be an area that could provide better margin.
“In 2010, there was almost zero contribution from the segment to Bina Puri’s revenue, due to timing as many developments under the group had just finished. As such, no contribution could be accounted,” he told reporters.
“As such, we hope the contribution from these properties will come this year, probably at a rough estimate of RM250 million, or at last 20 per cent to total revenue,” he stated further.
On a longer term, the group might see property development as contributing on the same par as construction to become its main revenue generator, probably on a half-and-half basis.
“This is what we are aiming for within the next five years.”
Commenting on such ambition, Tee maintained that it was a rather modest target.
“Remember that the segment had zero-contribution last year. Plus, we hit two very high-profile construction projects last year, namely the LRT Ampang and the KLIA-2 contracts. As all eyes will be on us with regards to delivery, we will not be overlooking our core expertise in building construction just as yet.
“Still, with building construction being a segment that is highly competitive and has the potential to become saturated, it will be good for us to diversify our revenue channels,” he pointed out.
Meanwhile, Tee remained highly optimistic on Bina Puri’s prospects of exceeding the RM1 billion revenue mark for the financial period ended December 31 last year.
“We are confident that the group will surpass its RM1-billion revenue target, not only for the fourth quarter and full-year financial of 2010, but also for this year,” he told reporters ahead of the group’s financial results report for the fourth quarter and full-year periods last year, to be announced today.
Tee was also confident that this year would prove to be a record year for Bina Puri.
“Based on ongoing projects secured from 2008 up to 2010, we are looking at getting some RM300 million in turnover from each project annually.”
To date, Bina Puri’s unbilled book order stands at about RM2.6 billion.