Land & General 4Q profit plummets 57.8% on lower property revenue

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KUALA LUMPUR (May 25): Land and General Bhd saw its net profit plunge 57.8% to RM7.1 million or 0.67 sen per share for its fourth financial quarter ended March 31, 2015 (4QFY15) from RM16.81 million or 2.74 sen per share a year ago on lower revenue from its property division.

In a filing with Bursa Malaysia today, Land and General (fundamental: 3; valuation: 3) said it recorded a 53.31% increase in revenue to RM56.37 million in 4QFY15 from RM120.74 million in 4QFY14.

Full year FY15 earnings rose 39.9% to RM105.43 million or 11.93 sen per share compared with RM75.33 million or 12.29 sen per share in FY14, despite revenue dropping by 5.4% to RM465.37 million from RM491.92 million.

Land & General also proposed a final dividend of 0.02 sen for FY15, of which the entitlement date and payment date will be announced at a later date.

Going forward, Land and General expects the property market to experience a slowdown following rising costs and the tightening of lending policies by the banks, but said amid these challenges, properties in strategic locations remain in demand.

“Premised upon this, the group is planning for the launch of its Astoria Project comprising four blocks of service apartments (1,012 units) on its land of 5.7 acres which was acquired last financial year, in the third quarter of 2015,” it said.

Land and General said the project is expected to bring in a total gross development value of RM845 million.

Also in the pipeline for launch in the coming financial year are the Damansara Foresta Project Phase 2 comprising 428 units with a gross development value of RM490 million; and the development of landed residential houses on 57 acres out of the group’s 190 acres of land in what was Tuanku Jaafar Golf & Country Resort, with a gross development value totalling to RM280 million.

The education and other divisions are expected to maintain their performance in the next financial year, the company said.

Land and General shares closed half a sen or 0.99% lower at 50 sen today, with a market capitalisation of RM545.24 million. 

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)