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Friday, 16 June 2017

(The Edge Financial Daily) EcoWorld sales up 30% to RM1.71b, 1H profit jumps 171%

BY CHONG JIN HUN & SURIN MURUGIAH

Its 27%-owned associate EWI posts first-half sales of RM1.05b

KUALA LUMPUR: Eco World Development Group Bhd (EcoWorld) reported a 30% rise in new property sales in Malaysia to RM1.71 billion for the seven months ended May 31, 2017, from RM1.32 billion a year earlier.

EcoWorld’s current financial year ends on Oct 31, 2017 (FY17). It reported the property sales for the Nov 1, 2016 to May 31, 2017 period in notes accompanying its second quarter of FY17 (2QFY17) results announced on Bursa Malaysia yesterday.

EcoWorld said its Klang Valley sales in that period amounted to RM1.329 billion. EcoWorld also has property projects in Johor and Penang.

“The group’s six projects in the Klang Valley contributed RM1.329 billion, its seven projects in Iskandar Malaysia contributed RM331 million, and the current two projects in Penang contributed RM45 million.”

In a separate statement, EcoWorld president and chief executive officer (CEO) Datuk Chang Khim Wah said the group is fortunate its projects have been enjoying positive momentum, especially the three large-scale developments in the Klang Valley that were launched at the end of the last financial year. They are Eco Ardence, Eco Grandeur and Bukit Bintang City Centre.

Chang also shared that the second half of FY17 (2HFY17) will see the launch of three new projects by the group, namely Eco Forest and Eco Business Park V in the Klang Valley, as well as Eco Horizon in Penang. These projects are expected to contribute towards the group’s sales in 4QFY17, according to EcoWorld.

“Based on sales secured to date and the plans which are under way for the next two quarters, we are confident [that] the group is well positioned to achieve our sales target of RM4 billion in Malaysia for FY17,” said Chang.

For 2QFY17, EcoWorld said, it achieved property sales of RM552 million for its Malaysian projects. 

The company reported a net profit of RM33.68 million for the quarter, versus RM34.68 million a year earlier, while revenue climbed to RM670.02 million from RM614.6 million.

1HFY17 net profit rose by 171% to RM149.85 million, from RM55.35 million a year earlier. Revenue gained 17% to RM1.26 billion from RM1.08 billion. In a separate statement to Bursa, EcoWorld’s 27%-owned associate Eco World International Bhd (EWI) reported that its second quarter ended April 30, 2017 (2QFY17) net loss narrowed to RM24.82 million from RM60.82 million a year earlier, while its cumulative six-month (1HFY17) net loss narrowed to RM30.88 million from RM118.63 million a year earlier.

EWI also shared that it achieved sales of RM1.05 billion during 1HFY17. As of the seven months ended May 31, 2017 (7MFY17), it had secured total sales of RM1.13 billion, bringing its total cumulative sales from its existing four projects to RM6.73 billion. The group has a sales target of RM2.5 billion for FY17.

EWI president and CEO Datuk Teow Leong Seng attributed the sales number to its well-balanced buyer profile and the fundamental attractiveness of its various projects in the UK and Australia.

“We are very fortunate to have cultivated a strong following for all our projects with a good mix of customers comprising both international and home country buyers.

This is a key advantage we will deploy going forward to achieve our ambition of becoming a significant global property player,” he said.

He added that interest in the group’s UK projects remains healthy, bolstered by good construction progress on-site, unique selling points of each project and positive developments in the surrounding areas.

“We will see profit recognition beginning in FY18 as handovers commence in phases starting with London City Island and Embassy Gardens. Our plans for the second half of 2017 include the completion of the proposed acquisition of 80% of the issued capital in Eco World-Salcon Y1 Pty Ltd and the launch of the Yarra One development in Melbourne,” said Teow.Teow added that EWI will seek out well located development sites in its three main target cities of London, Sydney and Melbourne to replenish its land bank.