PRG Holdings Berhad Annual Report 2018

REVIEW OF OPERATIONS 1. Manufacturing Division The business model of the Manufacturing Division has remained unchanged and the revenue and cost structure has remained stable during the year. As for the listing proceeds, RM5.0 million was utilised up to 31 December 2018 for expansion of production capacity. Certain expansion initiative was slowed down in view of the rapid change of global economy. Manufacturing Division is constantly reviewing and will continue to execute its business strategies based on the market conditions, particularly in expansion of production capacity. In addition, the division is also reviewing the cost structure regularly, to align with our business strategies as well as developing appropriate and effective processes to manage the cost efficiently. The Group will strive to enhance its market position as well as actively seeking new opportunities for growth. 2. Property Development & Construction Division Picasso Residence, Jalan Jelatek This is the maiden property development project of the Group. The development comprises 472 units of residential units on a 3.5 acres leasehold land along Jalan Jelatek, Kuala Lumpur. Picasso Residence was officially launched in October 2016. The Management reckoned there is delay in the project completion at this juncture and is taking proactive measures, liaising with relevant stakeholders to ensure smoother project implementation as the Group is committed to complete the project as soon as possible. In regard to the remaining unsold units, the Management is committed to several strategies to accelerate the sales of these units. The team makes constant assessment of the sales channels, sales activities and offerings to attract potential purchasers. Activities may include promoting Picasso Residence to a wider target audience both locally and abroad, collaboration and tie-ups with property sales agencies, building a showroom/gallery presence at the project site, the timely execution and completion of the construction of the buildings and facilities within expected quality standards by constant monitoring of progress at site and appropriately engaging the team of contractors, suppliers, consultants and authorities. group managing director’s management discussion and analysis (continued) PRG HOLD I NGS BERHAD 17