Kerjaya Prospek 3Q net profit triples on resumption of construction projects, proposes 1.5 sen dividend

Kerjaya Prospek 3Q net profit triples on resumption of construction projects, proposes 1.5 sen dividend
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KUALA LUMPUR (Nov 26): Kerjaya Prospek Group Bhd’s net profit tripled to RM30.38 million or 2.48 sen per share in the third quarter ended Sept 30, 2020 (3QFY20), from RM10.06 million or 0.82 sen per share in the preceding quarter as the group resumed its construction projects.

Quarterly revenue was also up 73.5% to RM222.21 million, from RM128.1 million in 2QFY20, according to its filing to Bursa Malaysia today.

The group had proposed an interim dividend of 1.5 sen per share for the financial year ending Dec 31, 2020 (FY20), amounting to RM18.49 million. It will be paid on Jan 6, 2021.

On a year-on-year basis, however, its net profit slipped 8% from RM33.01 million or 2.68 sen per share in 3QFY19, while revenue also declined 15.6% from RM263.33 million.

The company attributed the decrease in earnings to the progress of construction works on-site as it resumed operations after the movement control order (MCO) that took effect on March 18.

Moreover, contribution from its property development segment to the group's results was minimal as there was no project under development in 3QFY20.

For the cumulative nine months of FY20, its net profit fell by 39.6% to RM62.77 million or 5.1 sen apiece, from RM103.91 million or 8.42 sen apiece last year, while revenue slipped 28.6% to RM562.15 million from RM786.87 million.

On prospects, the group said its operations and financial performance are adversely impacted in FY20 compared with FY19, amid the various adversities and challenging landscape.

Nevertheless, the group is supported by an outstanding order book of RM3.59 billion as at Sept 30, 2020, which includes building construction contracts worth RM1.35 billion.

As the local property sector is expected to remain challenging in 2020, the group has decided to delay the launch of new projects to the second half of 2021.

Moving forward, the group aims to focus on the construction segment as its main revenue driver, while maintaining the manufacturing segment as part of its integrated business objective and strategy.

Kerjaya Prospek’s shares were up one sen or 1.08% at 93.5 sen at noon break, valuing it at RM1.16 billion. Year to date, the counter fell by 27.5% from RM1.29.

Lam Jian Wyn