Tropicana Corporation Berhad Annual Report 2022

Detailed analysis of the various business segments are as follows: Property Development & Property Management The property development and property management segments remain the key contributors to the Group’s revenue, generating RM626.8 million for the full financial year, decreasing by 8.5% or RM58.4 million from RM685.2 million in FY2021. This segment reported a loss of RM390.1 million as compared to a profit of RM76.2 million in FY2021. The lower segmental revenue in FY2022 was mainly due to the projects launched in FY2022 which were still in the early stages of construction. Besides that, the significant loss in the current year was mainly due to the losses incurred on the proposed disposals of two parcels of development lands for RM244.4 million in FY2022 as the proposed disposals had given rise to provisions for foreseeable losses of RM298.6 million. Overall, this segment continued to be the main contributor to total Group revenue at 66.5%. Property Investment, Recreation & Resort The Group’s revenue from the property investment, recreation & resort segment recorded at RM204.3 million as compared to RM105.3 million in FY2021, which increased significantly by RM99.0 million or 94.0%. This segment reported a lower loss at RM15.6 million as compared to a loss of RM85.4 million in FY2021. The significant improvement in revenue and profit was mainly due to reopening of borders which accelerated the return of international visitors which contributed to higher revenue and profit in FY2022 for this segment. Overall, the base earnings from this segment continues to remain at sustainable levels through recurring income of its investment properties. Investment Holdings & Others The Group revenue from this segment stood at RM111.5 million in FY2022 as compared to RM85.5 million in FY2021; an increase of RM26.0 million or 30.4%. The revenue from this segment continues to remain at sustainable levels which are contributed from a few subsidiaries namely Tropicana Building Materials Sdn Bhd, Tropicana Innovative Landscape Sdn Bhd and Tropicana SJII Education Management Sdn Bhd. This segment reported a higher loss of RM66.7 million as compared to a loss of RM26.8 million in FY2021 which was mainly due to recognition of a one-off gain on bargain purchase subsequent to the completion of the acquisition of a subsidiary in FY2021, whereby there was no such gain in FY2022 as well as lower unrealised gain on quoted shares in FY2022. Group Capital Structure FY2022 FY2021 RM'000 RM'000 Shareholders' Equity 4,268,549 4,636,144 Total Equity 5,755,011 5,984,117 Gross Borrowings 3,772,965 3,915,803 Cash and Bank Balances 649,884 638,603 Net Borrowings 3,123,081 3,277,200 Gross Gearing ratio 0.66 0.65 Net Gearing ratio 0.54 0.55 Net Assets Per Share (RM) 2.17 3.21 Overall, our balance sheet as at 31 December 2022 remained strong with total cash and bank balances and total equity of RM649.9 million and RM5,775.0 million respectively. The Group is well positioned to continue implementing its planned growth strategies. Despite the dropped in gross borrowings, the gross gearing of the Group has increased slightly as compared to 31 December 2021 being 0.66x (2021: 0.65x) due to the higher losses recognised during FY2022. However, the net gearing of the Group has decreased as compared to 31 December 2021 being 0.54x (2021:0.55x) due to higher cash and bank balances as at 31 December 2022. The Group is expected to improve its performance in FY2023 amidst a more challenging business environment driven by the momentum created from the Group’s stellar performance in FY2022 and the various pipelines of on-going projects. While prospects for the property sector remains challenging in the short-term, the Group believes that there will still be demand for properties in prime locations that have accessibility to superb amenities and competitive pricing. 33 MANAGEMENT DISCUSSION & ANALYSIS

RkJQdWJsaXNoZXIy NDgzMzc=