KLCCP bounces back to recovery path

KUALA LUMPUR: KLCCP Stapled Group, which consists of KLCC Property Holdings Bhd and KLCC Real Estate Investment Trust, expects stronger performance ahead as it continues to bounce back from the Covid-19 pandemic lows.

The group said the retail and hotel segments of its business would continue the path of recovery.

“The retail and hotel segments are expected to recover progressively towards the pre-covid levels boosted by the upcoming festive and holiday seasons and coupled with the increase in international travellers’ confidence.

“However, the recovery may be affected by the increasing business and labour costs, rising interest rates and the uncertainty in Covid-19 cases.

“The office segment is expected to remain stable with full occupancy and long-term leases which will continue to stabilise cash flows of the group,” KLCCP said in a statement.

In its third quarter ended Sept 30, the group said its pre-tax profit surged year-onyear (y-o-y) to Rm237.6mil from Rm154mil in the third quarter last year.

Net profit for the quarter grew by 30.4% y-o-y to Rm176.6mil.

It said revenue grew 43.7% y-o-y from Rm260.3mil to Rm374mil, underpinned by the steady growth in the retail and hotel segments.

The group declared a dividend of eight sen per stapled security which represents a distribution rate of 75.63% for the quarter.

“Overall performance of the retail segment improved following higher customer counts and better tenant sales arising from continuous promotional activities.

“Consequently, the rental assistance was also lower,” the group said in the notes to its financial statements.

The group said Suria KLCC and the retail podium of Menara 3 PETRONAS, which represents the retail segment, saw revenues leaping by 96.1% to Rm133.6mil.

Its pre-tax profit for the retail segment tripled to Rm107.8mil on improved tenant sales, resulting in a higher percentage rent as businesses regained normalcy.

The group also pointed out that its hotel segment had seen a significant improvement from a higher number of corporate events and growth in leisure travellers.

“The hotel segment represented by Mandarin Oriental, Kuala Lumpur (MOKL) recorded an impressive performance as revenues rose to Rm45.8mil compared with Rm5.9mil in the third quarter of 2021,” KLCCP said.

The group noted that MOKL’S resilient performance was backed by higher average occupancy at 55%, compared with 7% in the third quarter of 2021.

“The encouraging performance, particularly from the retail and hotel segments, gives the group the confidence that we are on track towards recovery,” it added.