KUALA LUMPUR: Property developer Eco World Development Group Bhd (EcoWorld Malaysia) posted a net profit of RM33.51 mil for the first quarter (1Q) ended Jan 31, 2020, up 10.5% year-on-year due to improved contribution from the group’s Malaysian joint ventures (JVs).
The share of results from the local JVs rose 26.2% to RM22.55 mil. In contrast, share of results from Eco World International (EcoWorld International), which is developing overseas JV projects, fell 43.2% to RM3.49 mil due to fewer completed units handed over, it said in a filing with Bursa Malaysia today.
EcoWorld Malaysia’s revenue expanded to RM537.94 mil from RM491.23 mil a year earlier.
It attributed the 9.5% revenue growth mainly to additional incentives offered to purchasers in financial year 2019 in support of the government’s National Home Ownership Campaign.
The company has set an interim sales target of RM2 bil for the financial year ended Oct 31, 2020 (FY20), which it will revisit when the Covid-19 outbreak has been contained and business activities normalise. It recorded RM305 mil in sales in 1QFY20.
Meanwhile, EcoWorld International made a net profit of RM5.19 mil for the same quarter compared with RM22.76 mil in the year-ago quarter, when a high number of units were handed over in the UK.
It posted a revenue of RM51,000 compared to nil a year earlier, due to fees for marketing services rendered by a subsidiary to the group’s joint-venture in respect of UK property sales.
The company achieved RM314 mil in sales in 1QFY20 versus RM120 mil in the same period in FY19 thanks to a recovery in demand for higher-end products in London. It has set a FY20 interim sales target of RM2.2 bil.
In a press statement, EcoWorld Malaysia president and CEO Datuk Chang Khim Wah said the company recorded RM305 mil in sales in 1QFY20, an improvement over the RM230 mil sales achieved in the first four months of FY19, on the back of encouraging build-up of confirmed bookings at various projects by the end of February and in early March.
“However, that conversion of the group’s strong bookings pipeline will be delayed due to the implementation of the tough but very necessary Movement Control Order (MCO) by the government to combat the rapidly escalating Covid-19 outbreak,” he said.
The MCO, which was initially for a period of two weeks, has been extended by a further two weeks requiring all the group’s business premises and galleries to be closed from March 18 to April 14.
Hence, the company has activated its business continuity plans to enable its staff to work from home and follow up with customers, end-financiers and solicitors during the restricted movement period.
“Preparations are also being made to roll out EcoWorld’s new brand of homes priced from RM300,000 to RM450,000 to specifically cater to the needs of the M40 group,” he added. – March 26, 2020, Bernama