EcoWorld’s 2Q net profit rises despite lower revenue

KUALA LUMPUR: Eco World Development Group Bhd’s (EcoWorld Malaysia) net profit for the second quarter (Q2) ended April 30, 2018, improved slightly to RM34.45 million from RM33.68 million in the same period last year.

In a filing with Bursa Malaysia yesterday, the property developer said the increased net profit was due to higher profit contributions from the group’s Malaysian joint-ventures as well as lower administrative expenses.

Revenue, however, fell 25.6 per cent to RM498.69 million, mainly due to the handover of Towers A and B at the Eco Sky integrated development in Kuala Lumpur during the first quarter of this financial year and slower progress of works during the Chinese New Year (CNY) festive season.

President and chief executive officer Datuk Chang Khim Wah said the quarter under review began well with sales interest picking up following a successful CNY campaign and positive response to various localised marketing activities undertaken by projects in the Klang Valley, Iskandar Malaysia and Penang.

“However, in the lead up to 14th general election, the buying momentum turned slow – uncertainties on the outcome caused many customers to hold back from making commitments from April until early May,” he explained.

Going forward, the group’s profit would increasingly be derived from projects undertaken by its various joint-ventures in Malaysia and abroad as these

However, in the lead up to 14th general election, the buying momentum turned slow – uncertainties on the outcome caused many customers to hold back from making commitments from April until early May.

projects attained the threshold and criteria for profit recognition began, EcoWorld Malaysia said.

“Notably, the company’s international joint- venture, namely Eco World International Bhd (EcoWorld International), is expected to turn profitable in the second half of 2018 when its London City Island and Embassy Gardens projects are completed and handed over, commencing from the third quarter of 2018,” it said.

EcoWorld International, which also announced its 2Q results yesterday, reported a 19.7 per cent wider net loss of RM28.87 million versus the corresponding period of last year.

The higher loss was due to an unrealised foreign exchange ( forex) loss of RM6.88 million incurred in the quarter ended April 30, 2018, compared with an unrealised forex gain of RM12.57 million recorded a year earlier.

As at 2Q of this year, EcoWorld Malaysia achieved sales of RM923 million while EcoWorld International chalked up RM698 million in sales in the first seven months of financial year 2018. — Bernama