KUALA LUMPUR: The Eco World group is targeting to achieve RM12bil worth of sales for its Malaysian and international operations over financial years 2019 and 2020.
For its financial year ended Oct 31, 2018 (FY18), local and international sales exceeded RM6bil.
Eco World Development Group Bhd (Eco World Malaysia) chairman Tan Sri Liew Kee Sin, the man behind the group, was in his element at the group’s FY18 results briefing. “Finally, we are making money in London. It has been a tough year (2018) but it has been a good year for us. We expect 2019 to be equally tough,” said Liew.
Moving away from year-to-year projections as is normally the case, Liew said he was stepping out of the ordinary to project collective sales over a combined two-year period for both Eco World Malaysia and Eco World International Bhd because of Brexit, the stamp duty issue in Australia and the current local climate.
He said it was impossible to commit to a year-to-year projection because Britain is scheduled to leave the European Union in March 2019, and there is also the yet-to-be-resolved US-China trade war and the Malaysian situation.
“But we can do RM12bil through both companies over a two-year period,” he said, adding that he would like a 50:50 split bearing in mind that Britain’s built-to-rent (BtR) market would be Eco World International’s key growth driver.
Liew said the BtR market is a trillion-dollar business in the United States, but a million-dollar business in Britain.
“We want to help turn it into a billion-dollar business.”
Eco World International turned profitable in FY18 with RM35.5mil in profit after tax versus a loss of RM87.5mil a year ago.
It recorded total sales of RM3.3bil in FY18, above its set target of RM3bil and over 60% higher than the RM2bil achieved in FY17.
Eco World International’s share of unbilled sales to be carried forward to FY19 reached a record high of RM6.62bil. Although it has projects in Australia, Liew said the high points achieved by the company were due to Britain, where it is involved in open market sales for its three projects in London City Island, The Wardian and Embassy Gardens. However, it is the BtR segment that he is thrilled about.
Eco World International president/CEO Datuk Teow Leong Seng said: “Our decision to enter the extremely resilient Britain mid-mainstream market with its fast-growing BtR subsector has proven correct. We are indeed humbled to have managed to win the confidence of Invesco Real Estate, a global property investment management firm, for the sale of more than 1,000 BtR homes to one of its international separate account clients recently.
“At more than RM2bil in value, this sale is the largest BtR deal ever concluded in Britain – that it was achieved in less than six months after we completed our acquisition of 70% of the Willmott Dixon residential development business makes it especially notable,” Teow said.
Eco World London – Eco World International’s 70% joint venture with Willmott Dixon – already has existing sites with the potential to deliver over 3,000 BtR units, which the group intends to realise over the next two to three years. It aims to build a total of 10,000 BtR units over the longer term.
On the home front, Eco World Malaysia’s core profit after tax grew 46% from RM113.1mil in FY17 to RM165.6mil in FY18.
Its share of results from joint-ventures increased by RM86.3mil, from a loss of RM30.9mil in FY17 to a profit of RM55.4mil in FY18.
Despite cuts in marketing, overheads and administrative expenses, the company managed to achieve the same amount of sales, and this helped with the overall numbers.
Total sales form Malaysian projects exceeded RM3.1bil in FY18, with more than RM2.2bil achieved in the second-half of 2018. Its share of unbilled sales to be carried forward to FY19 stands at RM6.44bil, a record high for Eco World Malaysia.
Eco World Malaysia president/CEO Datuk Chang Khim Wah, said the company would be embarking on a new home ownership campaign in January 2019 called HOPE – Home Ownership Programme with Eco World.
It incorporates two innovative solutions to help customers own their homes and is targeted at owner-occupiers aged 40 years and below in search of a lifestyle, landscaped environment with amenities and digitally connected.
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