GOLDEN Hope Plantations Bhd expects a gross profit of RM900mil from the proposed unincorporated joint ventures between its subsidiaries, Golden Hope Development Sdn Bhd and Negara Properties (M) Bhd, to develop four new townships over a 10- to 15-year period.

Its group chief executive Datuk Wahab Maskan said for Golden Hope Development alone, the joint ventures were expected to contribute a gross profit of about RM367mil.

“The joint ventures will have no material impact on the earnings of the Golden Hope group itself for the financial year 2002/2003 but are expected to contribute positively to future earnings,” he told reporters after the company's EGM in Kuala Lumpur yesterday.

At the EGM, Golden Hope shareholders approved the four unincorporated joint-venture agreements between its wholly-owned subsidiary Golden Hope Development, and 62%-owned subsidiary Negara Properties.

Wahab said the joint ventures represented a strategic move by the group to best manage its property activities and land banks, as well as maximising shareholder value.

“Golden Hope will also be able to enhance the value of its investment in Negara Properties through the development rights in more than 2,600 acres of prime land,” he said.

The move also allows Golden Hope, via Golden Hope Development, to consolidate its strength as a strategic landowner involved in the total property business value chain and Negara Properties to focus on its role as a specialist property developer with a proven track record and established brand name.

Under the joint-ventures agreements, Golden Hope Development has granted Negara Properties rights to develop the Bangi estate in Selangor (722 acres), part of Kota Bayuemas in Klang (154 acres), Old Lunderston estate in Jenjarom, Selangor (395 acres) and part of Kota Seriemas in Nilai, Negeri Sembilan (1, 331 acres) over a period of 10 to 15 years.

According to Wahab, the property division is expected to continue contributing 20%-30% to the group's annual profits in the future.

“The property division is the group's second core business after plantations,” he said adding that the focus on property would help support Golden Hope core plantation operation.

Wahab said the group would continue to look for opportunities to increase its land bank, particularly in east Malaysia .

It has a total land bank of 420, 000 acres, inclusively of oil palm, rubber and fruit plantations.

Wahab also said the group hoped the price of crude palm oil (CPO) could be maintained at current levels.

“We are confident that in the short term, CPO prices will remain friendly. If they stay at an average of RM1,200-RM1,250 tonne for the rest of the year, that would be good enough,” Wahab said.

On the group's performance for the financial year ended June 30, he said it had achieved “much better” results compared with last year Golden Hope is expected to release its full-results on Aug 28.