Eco World International sees maiden profit in fiscal 2018

PETALING JAYA: Property developer Eco World International Bhd (EWI) is expecting to post its maiden profit this financial year ending Oct 31, 2018 (FY18) from effective unbilled sales that stood at RM5.89bil as at Feb 28.

It said in a stock exchange filing that the company will be able to convert a significant portion of the unbilled sales into revenue following the upcoming handovers of the London City Island and Embassy Gardens projects. This will enable it to recognise the maiden profit in the current financial year.

The company said that due to the completion method of accounting adopted in both Britain and Australia, revenue and profits associated with property development activities will only be recognised when construction of properties sold are completed and delivered to purchasers.

The company expects this to take place in the third to fourth quarters of 2018.

Meanwhile, the company posted a net loss of RM16.2mil in its first quarter ended Jan 31, 2018 with revenues of RM18,000.

The company said revenue for the first quarter of the year was due to the fees for marketing services rendered by a subsidiary of its joint venture.

The pretax loss reported in the quarter was higher compared to the same quarter of the previous year due to a much larger unrealised gain on foreign exchange recorded then, it said.

In the first four months of FY18, EWI said in a press release that it secured RM243mil sales with its existing three projects in London contributing RM206mil while those in Australia generated RM37mil.

“Whilst market conditions for prime London properties remain soft, demand at the mid-mainstream segment continues to be robust,” it said.