Iconic set to record first full-year profit in 14 years
Tourism company benefits from venture into property
KUALA LUMPUR: Tourism and property-based Iconic Worldwide Bhd is on track to register a full-year profit for the financial year ending March 31, 2020 (FY2020), making it the first profitable financial year in 14 years for the company.
Managing director Datuk Tan Kean Tet told Starbiz that “we have undertaken some restructuring exercises within the group to cease loss-making businesses and to focus on businesses that have higher potential.
“One of our efforts to improve the earning visibility of Iconic Worldwide is to venture into the property industry with our maiden property project called Iconic Point.”
The property project will be jointly-developed with Iconic Development Sdn Bhd, a wholly-owned subsidiary of Iconic Group, on a piece of freehold land in Penang.
For FY2019, the company registered a revenue of RM20 mil with a loss of tax of Rm16.2mil.
For the first quarter of FY2020 ended June 30 2019, Iconic Worldwide recorded a profit after tax of Rm1.31mil with a revenue of Rm2.48mil driven by its restructuring of the existing operations and ceasing of loss-making businesses.
He disclosed that Iconic Point was 100% sold during its two-day soft launch in Penang last month, which gives the company confidence to concentrate on the property development business.
The project is expected to contribute to the company’s top and bottom line for the next two financial years.
Iconic Point is a mixed development project worth about Rm127.81mil, located on 8.7 acres of land in Simpang Ampat, Seberang Perai.
Tan said: “We will be working on existing property development plans within Iconic
Worldwide and restructure it to suit the market needs.
“Currently, there are two projects in Seberang Perai that are under our radar, likely to be mix development projects that we shall announce next year.”
Despite obtaining shareholders’ approval for business diversification into properly development business in 2015, the segment did not make any significant contributions to the company’s results at the time.
The company launched its maiden project last month with the help from Tan, its new shareholder.
Iconic Worldwide is formerly known as Sanbumi Holdings Bhd, which was a company mainly involved in the tourism business.
The company received approval from its shareholders for its name change during the recent EGM on August 28.
Tan had emerged as the substantial shareholder of Sanbumi Holdings in January 2019 and was subsequently appointed as executive director in April and re-designated to the managing director in August.
Currently, Tan holds direct and indirect interests of 14.455% and 5.869% in Iconic Worldwide.
His son, Tan Cho Chia, the executive director of Iconic Worldwide, holds direct and indirect interests of 0.402% and 5.869% in the company.
Tan is also the founder and chairman of Iconic Group, a leading property developer company in the northern region completing property development projects worth about Rm500mil in gross development value and has ongoing projects worth some Rm80.6mil in GDV.
The projects that he has completed included Icon City, Iconic Hotel and Iconic Skies.
Apart from the maiden property project, Tan noted that a hotel management agreement is already in progress for Iconic Worldwide, and this will also help to improve the company’s earnings visibility from this financial year onwards.
On April 1, Iconic Worldwide entered into a hotel management agreement with Lucky 888 Sdn Bhd, an affiliated company to Iconic Group, for the provision of services to Iconic Hotel.
This contract will provide a stable recurring revenue and additional income stream to Iconic Worldwide.