KUALA LUMPUR (May 27): IJM Corp Bhd reported a net profit of RM794.89 million for the financial year ended March 31, 2022 (FY22), an 83.21% jump from RM433.88 million last year, mainly due to the gain of RM633.8 million from the disposal of its entire stake in its plantation subsidiary.

However, net profit of the continuing operations which exclude the plantation business plunged 68.8% year-on-year to RM134.94 million. Revenue for FY22 slipped to RM4.41 billion from RM4.69 billion a year ago as a result of the nationwide lockdowns between June and September 2021, the group said in a filing on Friday (May 27).

The 5.9% lower revenue y-o-y was caused by the 21.5% decrease in the revenue from the construction segment, which came in at RM1.53 billion in FY22. Most other operating segments of IJM Corp also saw lower revenues during the year, except for the manufacturing and quarrying segment, which saw its revenue jump 24% y-o-y to RM856.94 million.

This lower revenue contributed to a 37.8% decline in profit before tax for IJM Corp during the year, which came in at RM317.87 million.

For the fourth quarter ended March 31, 2022 (4QFY22), the group recorded an operating revenue of RM1.233 billion, which was a 9% y-o-y decrease. Pre-tax profit came in at RM68.8 million during the quarter, which was 62.9% lower y-o-y.

IJM Corp explained that the construction segment's revenue and pre-tax profit for FY2022 decreased by 21.5% and 11.6% respectively compared with FY21, mainly due to lower construction activities as a result of the lockdown and higher share of losses from an associate.

Meanwhile, for the property development segment, revenue for 4QFY22 increased by 8.3% mainly due to higher sales achieved during the final quarter. However, revenue for FY22 decreased marginally by 1.8% mainly due to higher sales of completed units in Royal Mint Gardens in FY21, said IJM Corp in the result announcement.

The property development segment's pre-tax profit for 4QFY22 and FY22 decreased by 75.6% and 45% respectively compared with 4QFY21 and FY21, mainly due to impairment of inventories in 4QFY22 of RM66 million pertaining to its industrial development in Kuantan coupled with unfavourable unrealised foreign currency movements, the group stated.

The higher revenue for the manufacturing and quarrying segment compared with in FY21 was principally due to higher deliveries of piles, quarry products and ready-mixed concrete, said IJM Corp in the result statement.

Excluding the disposal gains of RM78.6 million in FY21 of the manufacturing and quarrying segment, the pre-tax profit of the segment for FY22 improved significantly by 759.6%, it said.

For the plantation segment, revenue and pre-tax profit recognition ceased following completion of the disposal of the company's entire 56.2% equity stake in IJM Plantations Bhd to Kuala Lumpur Kepong Bhd (KLK), which gave rise to the gain of RM633.8 million.

On Sept 6, 2021, IJM Corp completed the disposal of its entire 56.2% stake — 494.87 million shares — in IJM Plantations to KLK for a cash consideration of RM1.53 billion.

IJM Corp declared a second interim dividend of four sen a share with a June 29 ex-date, to be paid on July 22.

Looking at the financial year ahead, the group noted that in line with the nation's transition to the endemic phase, it expects a gradual recovery in the business landscape to pre-pandemic levels in FY23.

"For FY23, the group's construction division will be focusing on the timely execution and completion of its outstanding order book of RM4.26 billion, of which RM1.68 billion of new projects were secured during FY22," it said, adding that it is optimistic to increase its order book with the resumption of economic activities.

As for its property segment, it said market sentiment for the sector has seen a strong recovery, and together with the segment's "wide array of highly sought-after products" and unbilled sales of about RM2.3 billion, the segment is expected to deliver a satisfactory performance for FY23.

"The industry segment's business rationalisation efforts through product quality improvements, cost optimisation and process efficiency enhancements have continued to enhance its market competitiveness. With a strong order book in hand, the segment is expected to deliver a positive performance," it added.

IJM Corp said that equipped with the recovery to pre-pandemic levels, the group expects its performance for FY23 to be good.

Shares in IJM Corp finished six sen or 3.45% higher at RM1.80, giving the group a market capitalisation of RM6.56 billion.