Parkwood Berhad : 51st AGM Answer the queries from MSWG

Our Ref: PARKWOOD/MSWG/2022

[e-mail] 013-2976076

16th June 2022

Mr. Devanesan Evanson	By Email/ Hand
Chief Executive Officer,
Minority Shareholders Watch Group,
Level 23, Unit 23-2, Menara AIA Sentral,
No. 30, Jalan Sultan Ismail,
50250 Kuala Lumpur.

Dear Sir,

Re: Fifty-first ("51st") Annual General Meeting ("AGM") of Parkwood Holdings Berhad ("the Group" or "the Company")

___________________________________________________________________________

With reference to your letter dated 23rd May 2022 pertaining the above Annual General Meeting, we append herewith our reply to your queries as below:

Operational & Financial Matters

1. For the financial year under review, the Group recorded a loss before tax (LBT) of RM3.81 million (FY2020: LBT of RM3.81 million) due to higher operating costs during the challenging financial year (Page 10 & Page 64 of the Annual Report 2021).
   MSWG's question:
2. 1. How does the Board plan to address the higher operating cost and loss before tax of Parkwood, moving forward?
      Our Reply:
      Increase in loss before tax was mainly due to the following: -
   2. 1. Increase in finance cost of RM0.49 million
         The Group had secured and drawdown a borrowing of RM 21.7million to finance the acquisition of 5 parcels of leasehold commercial lands located at Damansara Damai. The finance cost from the borrowings has resulted the increase in finance cost.

Date	: 16th June 2022
Ref	: PARKWOOD/MSWG/2022
Page	: Page 2 of 4
Re	: Fifty-first (51st) Annual General Meeting of Parkwood Holdings Berhad

1. 1. 1. Increase in administrative expenses of RM0.93 million mainly due to following: -
      2. • One time written-off redundant renovation with net book value of RM0.36 million.
         • Provision for fair value loss on long term investment in bond of RM0.30 million due to temporarily drop in bond value during the height of the Covid-19 pandemic in FY2021. The drop is expected to recover in near future.
   2. What is Parkwood's financial performance outlook in FY2022?
      Our Reply:
      The Group expects the financial performance and cash flow to be improved as fresh progressive billings to be billed to our purchasers are expected in FY2022. This is in tandem with the completion of construction works and additional sales.
2. Utamara Boutique Residences (UBR)
   MSWG's question:
3. 1. What is the progress of the construction works of the Group's maiden UBR project?
      Is the project on schedule? Our Reply:
      The work progress as of 15 June 2022 is approximately 60%. The progress has been derailed from the original schedule due to Movement Control Order (MCO) and intermittent lockdowns arising from the Covid-19 pandemic.
   2. What are the current sales and targeted sales in FY2022? Our Reply:
      The current sales status is approximately 40% and the targeted sales for FY2022 is at least 50%.

Date	: 16th June 2022
Ref	: PARKWOOD/MSWG/2022
Page	: Page 3 of 4
Re	: Fifty-first (51st) Annual General Meeting of Parkwood Holdings Berhad

1. Upcoming Mixed-use Development at Damansara Damai (Proposed Development)
   Parkwood is in the midst of applying for planning permission for the proposed development (Page 13 of the Annual Report 2021).
   MSWG's question:
   What is the update on the above matter? Our Reply:
   The planning permission is still pending approval from the local council as the progress was also affected by MCO and intermittent lockdowns in year FY2021.
2. Landbank
   MSWG's question:
3. 1. What is Parkwood's current landbank size? Our Reply:
      Currently, the Group has a total landbank of 16.75 acres.
      (Please refer to page 51 of the Annual Report 2021 for details of the Group's landbanks).
   2. How long will it take to develop the existing landbank?

Our Reply:

It is estimated to be about 5 years from now to fully developed the existing landbank.

1. What is the targeted landbank replenishment in the next two financial years? Our Reply:
   The Group has started sourcing for strategic development land to ensure business continuity. The timing for any acquisition depends on the availability of such suitable landbank.

Date	: 16th June 2022
Ref	: PARKWOOD/MSWG/2022
Page	: Page 4 of 4
Re	: Fifty-first (51st) Annual General Meeting of Parkwood Holdings Berhad

1. MSWG's question:
   On Investment property, what is the business outlook for the sport centre and factory warehouse of the Group in FY2022?
   Our Reply:
   The current rental incomes shall remain throughout FY2022 to bolster the overall revenues of the Group. However the rental income from the Sport Centre at Damansara Damai will only run until commencement of the proposed mixed-use development on the land.
   As for Avant Industrial Park at Section 15 Shah Alam, the rental income shall continue until end 2026.

We hope our explanations have provided sufficient insight to your queries. We will present the same to the shareholders at the forthcoming AGM.

Thank you.

Yours sincerely,

for Parkwood Holdings Bhd

__________________

Dato' Lim Yew Boon Executive Director