Tropicana Corporation Berhad Annual Report 2019

RM320.8 million Net Profit RM1.1 billion Revenue For the year under review, lower sales and progress billings across projects in the Klang Valley and the Southern region led to the decrease of 30.5% in Tropicana’s revenue, from RM1.1 billion compared to RM1.6 billion in the preceding year. Nonetheless, the Group’s profit before tax increased by 14.8% from RM320.2 million in 2018 to RM367.5 million in 2019 due to the recognition of gain on bargain purchase which arose when the Company acquired development lands held by 12 acquiree companies from a related party at a favourable price of an average discount of 13.4% to the market value of these lands and the corporate exercise to acquire was completed in November 2019. Net profit jumped 88.6% to RM320.8 million in 2019 from RM170.0 million recorded in 2018. Following the completion of this corporate exercise, Tropicana’s net gearing stood at 0.38 times as at 31 December 2019, as compared to 0.29 times in the previous year. This is expected to decrease over the next two years. T ropicana Corporation Berhad (“ Tropicana ”, “ the Group ” or “ the Company ”) has carved its name as one of the leading developers in Malaysia that design quality integrated developments and communities. In the last 30 over years, we have expanded our footprint across Malaysia, namely in the Central, Southern and Northern regions of Malaysia. Throughout 2019, Malaysia’s Gross Domestic Product (“ GDP ”) expanded 4.3% as compared to 4.7% registered in 2018, the slowest pace thus far in the last decade. Trade tensions, global geopolitical uncertainties and weak market sentiments lent towards softening global economic environment. The property market was also impacted, as it remained muted due to affordability issues, slow economic growth, high inventory levels and stringent home financing environment. Against this backdrop, the Group focused on laying the groundwork for the future by strengthening its foundation. Tropicana continued to design homes and shape living spaces to improve the quality of life and well-being of our communities. We rolled out new developments and phases that were in tune with market and customer needs, guided by our unique DNA, namely accessibility, connectivity, amenities, facilities, innovative concepts and designs, generous open spaces, multi-tiered security systems and quality. Notwithstanding market sentiments, Tropicana’s unbilled sales stood at RM836.5 million as at 31 December 2019, anchored on ongoing townships, commercial and resort themed projects and an existing landbank of 2,167.5 acres with a total Gross Development Value (“ GDV ”) of RM61.3 billion. RM367.5 million Profit before Tax Financial Performance Balanced and tranquil lifestyle at Tropicana Heights, Kajang Management Discussion & Analysis Tropicana Corporation Berhad Annual Report 2019 About Tropicana Our Strategic Performance Our Leadership pg 22