Paramount gets profit boost from educational business disposal

PARAMOUNT Corp Bhd posted a 644% spike in net profit to RM483.07 mil for its nine-month ended Sept 30, 2020 (9M FY2019: RM64.93 mil) in view of gain recognised on the disposal of its pre-tertiary education business of RM460.6 mil in 1Q FY2020.

However, its revenue for the nine-month period was 18% lower at RM405.18 mil from RM496.35 mil in the same period a year ago.

On the back of lower revenue, the group recorded a pre-tax profit of RM38.85 mil or a decline of 24.4% from RM51.41 mil in 9M FY2019.

This was mainly attributable to the negative impact of the COVID-19 pandemic to the property division in 2Q FY2020 but was mitigated by the improvement in profitability in 3Q FY2020 as compared to the corresponding quarter last year.

On a quarterly basis, Paramount’s net profit for 3Q FY2020 dipped 34.6% to RM19.82 mil from RM30.30 mil in the same period last year but marked a return to the black if compared to the preceding quarter (2Q FY2020) when it incurred a net loss of RM3.7 mil.

Commenting on the company’s results, CEO Jeffrey Chew said sales in 3Q FY2020 was 82% higher than that of the corresponding period last year, mainly from project launches this year comprising Sinaran at Utropolis Batu Kawan; Cendana at Greenwoods Salak Perdana, and Phase 2 of Sejati Lakeside.

“Despite the movement control order disruptions, our 9M FY2020 sales had grown by 5% to RM503 mil (9M FY2019: RM481 mil), thanks to our strong third quarter sales,” he pointed out in a media statement. “Our unbilled sales of RM1 bil as of Sept 30, 2020 was also a milestone achieved.”

As of Sept 30, Paramount has 443 acres of undeveloped land in the Klang Valley, Kedah and Penang.

In October 2020, it completed the purchase of 4.54 acres of land with buildings erected on it at Jalan Ampang Hilir in the vicinity of the prestigious U-Thant enclave of Kuala Lumpur City Centre.

The proposed development has a projected gross development value of RM863 mil and is expected to commence in the third quarter of 2021 with expected completion to be over a five-year period.

Although many of the group’s business operations have gone back to pre-pandemic level during 3Q FY2020, the resurgence of COVID-19 infections remains a risk, added Chew. – Nov 27, 2020

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