IOI Properties and Sunway Property records higher profit and revenue for the current quarter ended 30 September 2016 despite the property market gloom in 2016. PROPCAFE received official media release from both major developers Sunway Property and IOI Properties as per below.
IOI Properties Q1 FY17 Records Higher Revenue and Profit
25th Nov 2016 – IOI Properties Group Berhad (“IOIPG”) announced its Q1 financial results for the financial period ended 30 September 2016. The Group continues to deliver better performance amidst the current soft property market due to weak consumer sentiment and tight lending conditions.
IOIPG recorded revenue and profit before taxation of RM899.5 million and RM289.5 million respectively for the current quarter, which is RM304.3 million or 51%; and RM81.2 million or 39% respectively higher than the preceding year corresponding quarter. The Group’s operating profit of RM270.4 million for the current quarter is RM58.4 million or 28% higher than the preceding year corresponding quarter. The increase in both revenue
and operating profit are mainly attributed to the Group’s better performance in its three main
business segments, namely property development, property investment as well as leisure and
hospitality.
On this encouraging Q1 financial standings, the Group is optimistic that the local property market is expected to consolidate despite the challenging global economic environment with the demand for properties in the medium price range category to remain resilient.
The Group’s property development segment contributed revenue and operating profit of RM793.6 million and RM223.5 million respectively in the current quarter, an increase of RM291.4 million or 58% and RM46.0 million or 26% respectively compared to the preceding year corresponding quarter. The increase in both revenue and operating profit is mainly contributed from higher sales take-up rates for overseas projects in both Singapore and
Xiamen, PRC as well as projects in IOI Resort City Putrajaya and Warisan Puteri @ Sepang.
Its property investment segment also recorded better revenue and operating profit of RM71.3 million and RM42.5 million respectively, an increase of 17% and 43% respectively compared to the preceding year corresponding quarter. This is mainly attributed to IOI City Mall’s increased average occupancy rates from 88% to 94% and upward rate revision upon tenancy renewal. Apart from this, the ideal locations of the Group’s property investments
portfolios; within matured townships and high growth corridors have also contributed to
healthy occupancy rates and rental yields.
Meanwhile, the Group’s leisure and hospitality segment recorded a RM2.1 million or 7% increase in revenue, to RM32.5 million in the current quarter as compared to preceding year corresponding quarter. The increase in revenue is mainly attributed to Four Points by Sheraton, Puchong and Le Meridien Putrajaya, with the latter commencing its business operations in August 2016.
Its Chief Executive Officer Lee Yeow Seng commented that, “The Group will continue to focus on improving its group synergies to remain resilient and competitive.” On 22 August 2016, the Board has declared an interim single tier dividend of 8.0 cents per ordinary share, amounting to RM352,897,216 in respect of the financial year ended 30 June 2016.
SUNWAY BERHAD RECORDS HIGHER PROFITS IN PROPERTY AND CONSTRUCTION SEGMENTS
Bandar Sunway, 25 November 2016 – Sunway Berhad, one of Malaysia’s largest conglomerates with core interests in real estate and construction, today reported a 19.6% increase in revenue to RM1,137.5 million and a higher net profit of RM143.6 million for the current quarter ended 30 September 2016 compared to revenue of RM951.0 million and net profit of RM133.3 million in the corresponding quarter of the previous financial year.
“Given the improved third quarter results, we expect the Group’s performance to remain satisfactory for the remainder of the year as our last quarter performance tends to be our strongest seasonally. While we will proceed with caution in our business strategy due to the current unpredictability of the global economy, we are confident to meet the challenges ahead as we have the advantage of a diversified business portfolio,” said Chong Chang Choong, CFO of Sunway Berhad.
Sunway Berhad continues to maintain a strong balance sheet and low-gearing of 0.38 times.
STRONGER PERFORMANCE OVERALL
The property development segment reported a commendable 61.6% increase in profit before tax to RM62.2 million in the current quarter from RM 38.5 million in the corresponding quarter of the previous financial year despite lower revenue at RM 247.6 million compared to RM 270.9 million in the corresponding quarter of the previous financial year.
The higher profit before tax was contributed mainly by higher progress billings from local projects and other property projects in Singapore. Lower revenue was due to lower contributions from the Group’s wholly-owned Avant Parc project in Singapore which commenced revenue recognition in the corresponding quarter of the previous financial year, and was fully sold in the second quarter of this year.
Property sales year to date stands at RM 864 million compared to property sales year-to-date of RM 734 million in the previous year. Unbilled property sales remains healthy at RM1.8 billion, providing good earnings visibility for the property division.
The property investment segment also reported higher profit before tax of RM45.9 million compared to RM37.3 million in the corresponding quarter of the previous financial year. Third quarter revenue is also higher at RM189.9 million compared to revenue of RM172.2 million in the previous year. The better performance is due to better occupancy from Sunway’s portfolio of investment properties and an increase in the number of visitors to Sunway Lagoon and Lost World of Tambun following the opening of several new attractions, which include the Nickelodeon Lost Lagoon opened in February 2016.
The construction segment recorded revenue of RM287.9 million and profit before tax of RM32.2 million in the current quarter compared to revenue of RM196.8 million and profit before tax of RM24.1 million in the corresponding quarter of the previous financial year. Revenue in the current quarter was higher due to lower intra-group eliminations. Current profit before tax was also higher due to higher progress billings from local construction projects.
The construction order book remains healthy at RM 4.8 billion with a year-to-date order book replenishment of RM 2.6 billion.
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