Friday 29 Mar 2024
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KUALA LUMPUR (Sept 20): Eco World Development Group Bhd (EcoWorld) saw its net profit jump 47.6% to RM38.52 million in the third financial quarter ended July 31, 2018 (3QFY18) from RM26.09 million a year ago, on higher profit contribution from projects undertaken by its joint ventures (JVs).

The group's international JV, Eco World International Bhd (EWI), also recorded its maiden profit in the quarter under review following the commencement of delivery of completed property units at London City Island in the UK. The group's share of EWI's profit in 3QFY18 amounted to RM2.8 million, compared with a share of loss of RM6.5 million in 3QFY17.

As a result, EcoWorld's earnings per share (EPS) came in higher at 1.31 sen for 3QFY18 compared with 0.89 sen for 3QFY17.

This was despite a 35.8% drop in revenue to RM490.05 million in 3QFY18 from RM762.92 million a year ago.

In a filing with Bursa Malaysia today, EcoWorld attributed the lower quarterly revenue to its subsidiaries having completed some of their major projects and delivered a significant number of completed property units to customers since 2QFY17.

"As at 3QFY18, close to 9,000 units have been or are in the process of being delivered to customers," it said.

For the cumulative nine months (9MFY18), however, EcoWorld saw its net profit fall 44.8% to RM97.06 million from RM175.94 million a year ago, while revenue dropped 23.4% to RM1.55 billion from RM2.03 billion in 9MFY17.

"In future quarters, the group expects its earnings to be increasingly derived from projects undertaken by its JVs," said EcoWorld.

On prospects, EcoWorld said: "Management will be tapping onto the positive momentum generated from its campaigns to continue to lock in sales at all 18 of the group's ongoing projects, with the aim of achieving its FY18 Malaysian sales target of RM3.5 billion."

In a separate filing, EWI announced its maiden quarterly net profit of RM10.44 million in 3QFY18 compared with a net loss of RM24.2 million in 3QFY17, mainly due to recognition of revenue and profit by one of its JV projects in the UK following completion and commencement of handover of units sold to customers.

There was no revenue recorded by the group's subsidiaries in 3QFY18.

The turnaround in the quarter under review helped narrow EWI's net loss for 9MFY18 to RM34.84 million from RM55.08 million a year ago, while revenue fell to RM18,000 from RM461,000 in 9MFY17.

EWI said it is on track to achieve its RM3 billion sales target for the full year ending Oct 31, 2018 (FY18). As at Aug 31, 2018, a total of RM1.026 billion sales has been secured, with its ongoing projects in London contributing RM847 million while those in Australia generated RM179 million.

"The remaining sales will largely come from its new JV, EcoWorld London, which recently announced the entry into heads of terms with Invesco Real Estate for the sale and forward funding of more than 1,000 new Build to Rent (BtR) homes on two sites in Kew and Barking.

"EcoWorld London aims to complete the sale by October 2018 and this is expected to contribute towards achieving EWI's sales target for FY18," said EWI.

"In 4QFY18, another of EWI's project in the UK, namely Embassy Gardens, is expected to hand over its first units and this will add to EWI's earnings for FY18," it added.

In a separate statement, EcoWorld chairman Tan Sri Liew Kee Sin said prospects for EcoWorld and EWI remain very bright.

"As at Aug 31, 2018, EcoWorld's and EWI's effective share of unbilled progress billings stand at RM6.16 billion and RM6 billion respectively. Our large number of ongoing projects, the increasing maturity of our Malaysian landbank, coupled with the growing pipeline of new projects secured by EWI also provides us with a strong foundation on which to anchor our growth ambitions," he added.

EcoWorld brand's remaining gross development value to be developed amounts to RM86.5 billion on a combined basis, which Liew said the group will assure the sustainability of its local and international business model for many years to come.

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