Sunway Bhd to Develop RM222 million (US$73.2 million) Mixed-Commercial Project

| Source: Business Times

Sunway Bhd, controlled by property tycoon Tan Sri Jeffrey Cheah, has won a RM222 million contract from Cititower Sdn Bhd to construct a new mixed-commercial project at the eastern corner of the Kuala Lumpur City Centre.

The company said its unit, Sunway Construction Sdn Bhd, had accepted a letter of award that includes the construction and completion of piling and sub-structure works as well as associated works for Lot 185 and Lot 167(K).

Cititower is a joint venture between KLCC Holdings and QD Asia Pacific.

The project could take up to 82 weeks to complete with a commencement date yet to be fixed.

“It is expected to contribute positively to the earnings of the Sunway group from the financial year ending December 31 2013 onwards,” the company said.

In a filing to Bursa Malaysia yesterday, Sunway said the proposed project is subject to normal risk of price fluctuation for construction materials.

“However, with the past experience and expertise of SunCon in construction projects in Malaysia, this risk could be mitigated,” it said.

Last month, Sunway secured a contract worth RM304 million from Cititower for the construction of North East Car Park underneath KLCC Park.

The proposed project is expected to commence upon the handing over of the site possession, which is to be determined at a later date, with a construction period of 178 weeks.

Currently, the company order book stands at around RM4.2 billion and year-to-date, it has secured RM801 million worth of contracts. Among the projects are the BRT Sunway Line for RM452 million and the construction of the KLCC Car Park for RM304 million.

The rest of its order book is mostly made up of its MRT-linked jobs (around 27 per cent). The group also expects a replenishment rate of approximately RM1.5 billion per year.

For the financial year ended December 31 2012, Sunway managed to increase its pre-tax profit to RM728.23 million from a pre-tax profit of RM498.53 million, posted in the same period a year ago.

With this in mind, the company declared a final, single-tier dividend of six sen per share, which will be paid to all qualified shareholders today.

Its shares closed flat at RM2.74 on Monday.

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