Strong take-up in i-Park propels AME’s figures in FY20

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AME is seeing higher demand for its industrial properties in i-Park@Indahpura and i-Park@Senai Airport City from foreign companies from China, Singapore, Australia, Hong Kong, Japan and the US.

KUCHING: Strong take-up in the i-Park@Senai Airport City and i-Park@Indahpura propelled integrated industrial space solutions provider AME Elite Consortium Bhd (AME) to post double-digit growth in the financial year ended March 31, 2020 (FY20) with net profit attributable to shareholders rising by 34.6 per cent to RM63.7 million on revenue increasing by 12.2 per cent to RM380.3 million.

This compared favourably against the previous year, which saw RM47.3 million in net profit attributable to shareholders on RM339.0 million in revenue. Segmentally, revenue for AME’s property development segment doubled year-on-year to RM92.3 million from RM43.1 million.

In addition, the group’s i-Parks achieved record-high new sales of RM145.1 million in FY20, comprising customized factories at i-Park@Indahpura and i-Park@Senai Airport City, and commercial properties at The Jacaranda at i-Park@Senai Airport City. These complemented the higher progress billings from ongoing construction of industrial properties at the i-Parks.

Affin Hwang Investment Bank Bhd (AffinHwang Capital) in a note yesterday saw that AME Elite’s core net profit jumped 64 per cent year on year (y-o-y) to RM53 million in FY20, driven by better performance for all divisions.

“Sequentially, core net profit fell 50 per cent quarter on quarter to RM8.3 million in 4QFY20, mainly due to the movement control order impacting progress billings and property sales,” it said.

“AME is seeing higher demand for its industrial properties (purchase and lease) in i-Park@Indahpura and i-Park@Senai Airport City (SAC) from foreign companies from China, Singapore, Australia, Hong Kong, Japan and the US.

“AME secured higher value of new construction contracts worth RM451.9 million in FY20 compared to RM117.3 million in FY19.”

AME group managing director Kelvin Lee Chai said, “Even amidst the economic uncertainties, our i-Parks are clearly gaining traction amongst multinational corporations and expansion-focused entities as the ideal site to further their growth journey.

“We are heartened to receive continued strong interest in the past months for existing phases of i-Parks as well as Phase 3 of i-Park@Senai Airport City which commenced in January 2020.”

“Additionally, our existing landbank has a sizeable gross development value of more than RM1 billion as at March 31, 2020. This would allow us to cater to the encouraging demand for our industrial properties.”

“Moving forward, we are exploring landbanking opportunities to sustain our growth. We have allocated RM69.1 million of our Initial Public Offering proceeds for land acquisition purposes.

“We will continue to reinforce our position through expanding our i-Parks, as Malaysia continues to be a magnet for Foreign Direct Investment, evidenced by the continuous take-up in our industrial properties.”

TO note, AME declared a maiden interim dividend of three sen, giving reasonable net yield of 1.8 per cent for a growth company.

AffinHwang Capital cut its share estimate to RM2.86 per share from RM3.11 to reflect the net debt position of RM91 million at end-FY20.

“We reduce our target price to RM2 per share from RM2.18. AME remains as one of our top construction sector small-cap buys.”