TTC Land triples first quarter revenue over-year

TTC Land's Jamona series

In particular, TTC Land, previously known as Sacomreal JSC, handed over 108 products in the first quarter of 2018, a 193 per cent increase from the only 37 products in the same period last year. The majority of products sold belong to the Jamona projects, including Jamona City or Jamona Golden Silk in District 7, Ho Chi Minh City.

Gross profit stood at VND138 billion ($6 million), increasing by 96 per cent year-on-year. Financial earnings dropped by 46 per cent as TTC Land slashed lending activities and shifted focus to real estate development, which is the firm’s core business sector.

In the same period, 294 products have been bought by customers, representing a 87 per cent growth year-on-year.

According to TTC Land, financial expenses have declined by 37 per cent year-on-year despite a rise in interest rates, as the firm did not record any new losses from project consolidation. The firm is also in good financial health, given its loan-over-equity ratio of 0.57 and loan-over-asset figure of only 0.2.

In 2018 and early 2019, the firm will issue 212 million new shares to its current shareholders, aiming to raise charter capital to VND5.5 trillion ($241 million). The additional capital will be used for mergers and acquisitions activities.

The real estate business expects new equity funding to further decrease its reliance on bank loans and minimise interest burdens. Upfront payments from customers are also another helpful source.

TTC Land said during its 2018 general meeting that the new capital will be used for boosting its stake at various industrial zones, shopping malls, and hospitality real estate. The firm plans to expand to other areas besides Ho Chi Minh City, such as Phu Quoc Island, Danang, Dong Nai, and Haiphong. The anticipated land area under management will be 1,500 hectares.

Despite its strong business results, TTC Land noted that its after-tax profit still lags behind an impressive revenue growth, as the profit margin for social housing projects is much smaller than commercial ones like the Jamona series.

Inventories grew by 2 per cent to stand at VND4.1 trillion ($180 million), accounting for 42 per cent of TTC Land’s assets. This includes unfinished projects at TTC Plaza Ung Van Khiem (Binh Thanh district), Jamona Home Resort (Thu Duc district), Charmington La Ponte (District 10), and Carillon 5 (Tan Phu district). In 2018, the firm plans to hand over four projects (825 apartments) to customers, which will help drive down inventories.

Also in 2018, the firm will launch eight new projects, offering 3,000 more units to the market. The list includes Sky Villas and Jamona Heights in District 7, Charmington Tan Son Nhat in Phu Nhuan district, Carillon 6 and 7 in Tan Phu district and Tan Phuc Relocation Area in Long An province.

In 2018, TTC Land plans to reach VND2 trillion ($87.7 million) of consolidated revenue, up 4 per cent year-on-year, and after-tax profit of VND248 billion ($10.8 million), up 24 per cent. The dividend payout ratio will exceed 7 per cent.

TTC Land raises capital for Western-style management after name change TTC Land, previously known as Sacomreal JSC, will raise capital from existing shareholders and adopt a Western-style management structure to lure in foreign investors.

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