PPSP reports near six-fold increase in Q1 earnings

LOCAL public-listed industrial park operator Royal Group Phnom Penh SEZ Plc (PPSP), a member of Royal Group of Companies Ltd, reported sound business performance in the first quarter of the year, ended March 31, which is seen as a reflection of the rise in active factories in its flagship special economic zone (SEZ).

In a filing to the Cambodia Securities Exchange (CSX), PPSP posted total revenue and total equity of 122.949 billion riel ($30 million) and 273.992 billion riel for the JanuaryMarch period, respectively, up 580.90 per cent and up 7.55 per cent year-on-year.

Net profit was to the tune of 23.127 billion riel, compared to a net loss of 2.757 billion in the year-ago period.

As of March 31, total assets stood at 494.094 billion riel, of which 294.706 billion riel or 59.65 per cent were current assets. The debt-to-equity ratio came to 0.80, versus 0.85 a year earlier.

“The financial position of the company remains strong as at 31 March 2023,” PPSP non-executive chairman Kith Meng remarked in the filing.

The SEZ operator noted that the 357.32ha Royal Group Phnom Penh Special Economic Zone (RGPPSEZ), its flagship industrial park, was one of 17 “operating SEZs from a total of 36 approved SEZs in Cambodia” as of March 31.

An SEZ, often portrayed as a kind of commercial oasis, is a specially designated area within a jurisdiction’s borders that is subject to different – typically more lenient – legal, administrative, and economic regulations than elsewhere in the same jurisdiction. It may also include unique tax, logistical, or one-stop service arrangements intended to draw in business and investment.

PPSP began operations in 2007 with the development of the RGPPSEZ’s first phase after receiving government clearance on April 19, 2006, and it welcomed its first tenant in August 2008.

“Through our subsidiaries and associate companies, our group also provides security services, independent power production and distribution and dry port services to the zone tenants and zone investors of [RGPPSEZ],” PPSP said.

The company has recently established three notable new subsidiaries or affiliates: Royal Group Phnom Penh Special Economic Zone II Co Ltd for new SEZ development; Sahas Properties Co Ltd for property development; and Gomi Recycle (Phnom Penh) Co Ltd to team up with Japanese firms on solid waste management. “Gomi” notably translates as “rubbish” in Japanese.

RGPPSEZ’s tenants reportedly hail from 13 countries and territories – with the majority from Japan, Malaysia, Taiwan, mainland China, the US, and South Korea – and operate in a variety of industries such as vehicle components, electronics, garments, food and beverage, plastics, and jewellery.