KUALA LUMPUR (Aug 29): Paramount Corp Bhd's (KL:PARAMON) is expecting its 29-storey condominium in Bangkok to yield profit for the group despite facing a slower take-up rate, said its chief executive officer Jeffrey Chew Sun Teong.

The condominium, which comprises 255 units, recorded a 72% take-up rate as at end-December 2023, and remains unchanged till now.

“Since one year ago, not much movement. That is a terrible answer to give to you, but that is a fact. But the more scary fact is that we have completed [the project],” Chew told reporters during the group's second quarter results briefing on Thursday.

According to Chew, the low take-up rate is due to various factors, including a challenging economic climate in Thailand amid a slow post-Covid-19 recovery.

The Bangkok condominium, Na Reva Charoennakhon, is the only overseas project that the real estate developer currently has via its 49%-equity venture in Bangkok-based property developer Navarang Charoennakhon Company Ltd, in which it invested RM24.6 million.

Paramount has already revised the projected return on investment from the project to 11% from 16% previously.

Despite current challenges, Chew assured that there is no risk of incurring losses from the property.

To stimulate the sales, Paramount is considering offering additional discounts for the remaining units. It is also willing to give the project some time to mature. “We want to give them [the property in Bangkok] a little bit of time. We are supposed to recognise about RM4 million profit for this year [FY2024]. But we don't think we are going to lose any money,” he added.

The condominium carries a gross development project (GDV) of 1.2 billion Thai Baht (RM152.71 million), and is expected to contribute roughly 2% to the group's profit.

For the second quarter ended June 30, 2024 (2QFY2024), Paramount’s net profit was flat at RM24.23 million, compared with RM24.11 million the previous year. Revenue was down 3.57% at RM232.94 million from RM241.55 million last year, primarily due to the lower work progress in its property segment.

For the first half of FY2024, Paramount’s net profit dropped 10.5% to RM31.94 million from RM35.7 million in the previous year's corresponding period, as revenue fell 7% to RM405.55 million from RM436.11 million.

The group declared an interim dividend of three sen per share for the quarter, similar to that of last year, payable on Sept 26.

In releasing its latest quarterly results on Wednesday, the group had updated that sales for 1HFY@024 of RM638 million have surpassed that of the same period of FY2023.

"The Ashwood [residential development in Kuala Lumpur] that was launched in May 2024 has contributed to more than 60% of the sales. We are confident that the sales momentum will continue for The Ashwood and other projects," Chew was reported as saying in a statement.

Paramount, which has a sales target of RM1.4 billion for FY2024, is targeting to launch four more projects — including new phases of existing projects — in the second half of the year, with a projected gross development value of RM700 million.

"Expected launches in the third quarter of 2024 include Greenwoods Salak Perdana Senna in Sepang, comprising semi-detached cluster townhouses,” he said.

As at June 30, 2024, the group's unbilled sales stood at RM1.4 billion while its undeveloped land stood at 416.9 acres.

At the close, shares of Paramount were up one sen or 0.94% at RM1.07, valuing the group at RM666.37 million.

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