Mines Golf Resort Berhad’s Bank Guaranteed Serial Bonds and Bank Guaranteed Commercial Papers ratings are affirmed reflecting the unconditional and irrevocable guarantee provided by Malayan Banking Berhad (Maybank).

Mines Golf Resort Berhad (MGRB) is principally a property development company, currently developing a project named “South of the Mines” (South Lake Project); an upmarket mixed development predominantly residential and covering 211 acres in the vicinity of Jalan Sungai Besi, to complement the existing Mines Resort City also known as the North Lake. The South Lake Project is expected to exploit the retail and recreational potential of the Resort City. Total GDV of the South Lake Project is estimated at RM1.37 billion yielding total profit of RM586.4 million. The project’s offering of a unique living concept coupled with its strategic location serves to mitigate the company’s exposure to market risk.

Revenue continued on an increasing trend, reaching RM3.5 million in FY 2003 (FY 2002: RM1.6 million) and mainly driven by sales of the bungalow lots. ‘The Heritage’, a mixed development project, had experienced good take up rates upon its first launch in November 2003 while the remaining phases are expected to be launched in 2004. Operating margin was lower for FY 2003 as a result of higher operating expenses associated with the new launches during the year.

MGRB’s debt leverage position has been maintained at an average of 1.5x over the last four years, well below the cap of 9.0x under the issue structure. Cash flow interest coverage and debt coverage ratios returned to the black compared to a deficit position in FY 2002 as substantial development expenditure were incurred in the previous year for the initial stages of development.

Going forward, revenue will continue to be driven by sales of the bungalow lots and ‘The Heritage’; in addition to the expected launches of the remaining residential and commercial projects under the South Lake development.