This article first appeared in The Edge Financial Daily on December 14, 2018

KUALA LUMPUR: Eco World Development Group Bhd (EcoWorld) doubled its net profit to RM68.53 million in its fourth quarter ended Oct 31, 2018 (4QFY18) from RM33.71 million a year ago, as Eco World International Bhd (EWI) turned profitable during the quarter.

In a filing with Bursa Malaysia yesterday, EcoWorld said this increased its quarterly earnings per share to 2.33 sen from 1.14 sen.

During the quarter under review, EcoWorld recognised a profit of RM36.43 million from its share of results in joint ventures, against a loss of RM11.71 million a year ago.

The group’s net profit was also boosted by lower selling and marketing expenses of RM27.9 million and a decrease of RM10.2 million in administrative expenses, it said.

Revenue in the quarter, however, fell 32.79% year-on-year to RM607.58 million from RM904.06 million due to completion of some major projects and delivery of a significant number of completed property units to customers by subsidiaries.

For its full financial year (FY18), EcoWorld’s net profit declined 21.02% to RM165.59 million, or 5.62 sen per share, from RM209.65 million, or 7.25 sen per share, while revenue was down 26.04% to RM2.17 billion, from RM2.94 billion.

Meanwhile, EWI made a net profit of RM70.08 million in its fourth quarter, compared to a net loss of RM32.56 million a year earlier due to revenue and profit recognised by joint venture (JV) property projects in the UK.

Revenue surged to RM4.89 million in the fourth quarter ended Oct 31, 2018 (4QFY18) from RM27,000 a year ago, on the back of fees for marketing services rendered by a subsidiary to the group’s JV.

The earnings in the quarter were mainly due to recognition of profit and revenue from the completion and commencement of handover of units sold to customers, which enabled EWI to recognise RM94.36 million as its attributable share of profit from its JVs, as opposed to the share of profit of RM1.39 million taken up in the previous year.

For FY18, EWI reported a net profit of RM35.24 million compared to a net loss of RM87.63 million a year earlier. Revenue surged to RM4.9 million from RM488,000.

Going forward, EcoWorld has set a total sales target of RM12 billion over the next two years, split evenly across its Malaysian operations and international projects under EWI.

In a press briefing, Liew acknowledged that the property market would continue to face substantial headwinds both domestically and internationally, but expressed confidence that EcoWorld would post better results than in FY18.

This confidence is underscored by the group’s record high unbilled sales, for both domestic and abroad, of RM6.44 billion and RM6.62 billion — the latter under EWI — respectively.