Iskandar Investment expects earnings to take off next year

By Sharen Kaur

sharen@nstp.com.my

Published in NST on December 25, 2012

ON SOUND FOOTING: Company sees recurring income from completed projects in Iskandar Malaysia

ISKANDAR Investment Bhd (IIB) expects earnings to improve next year as it generates recurring income from completed projects in Iskandar Malaysia, Johor, said its president and chief executive officer Datuk Syed Mohamed Syed Ibrahim.

IIB, which is 60 per cent-owned by Khazanah Nasional Bhd, also expects strong returns in the form of dividends from its investments in several joint venture developments with the likes of UEM Land Holdings Bhd and Sunway Bhd.

Syed Mohamed, however, declined to comment on IIB's expected net profit and revenue for fiscal years 2012 and 2013.

He said IIB is currently "profitable" and that the global financial meltdown has so far not had an impact on its performance, including its developments in the Iskandar region.

According to its audited financial statement for fiscal 2010, IIB's total net operating revenues rose 60.27 per cent from RM488,280 to RM782,571.

Its operating results increased from a loss of RM80,779 in 2009 to a profit of RM13,381 a year later.

The other shareholders of IIB, which was set up in 2006 as a strategic developer of catalytic projects in Iskandar Malaysia, are the Employees Provident Fund and Kumpulan Prasarana Rakyat Johor Bhd, who each own a 20 per cent stake in the company.

As the catalyst of change, IIB promotes, coordinates and invests in strategic and catalytic initiatives through joint ventures or contribution of land, either through sale or lease, or granting of a concession or development rights.

IIB is developing four clusters - education, driven by Educity; leisure and tourism, led by LegoLand; healthcare and wellness, with Gleneagles Medini Hospital being the key driver; and creative development, with Pinewood Iskandar Malaysia Studios as the catalytic project.

Thus far, Legoland has been completed along with several universities at Educity, including Newcastle University, the University of Southampton Malaysia campus, Raffles University Iskandar and Marlborough College.

Meanwhile, Syed Mohamed said there are no plans to list IIB on the local bourse to fund future expansion.

On how IIB intends to fund new catalytic projects, he said it will partly use internal funds as the recurring income base builds up.

Business Times recently reported that IIB is mulling the possibility of selling some of its operating assets in Johor to help fund the next stage of development in Iskandar Malaysia.

IIB has received offers from local and European fund managers and asset management companies for the assets it owns, especially those in Educity.

"We are not selling the assets currently. Going forward, because of such request, IIB can package the sale of new income recurring assets with yield that will match their expectations," said Syed Mohamed.