KUALA LUMPUR: Eastern & Oriental Bhd posted net profit of RM18.75mil in the third quarter ended Dec 31,2019, boosted by an unrealised exchange gain of RM23.10mil.
The niche property developer announced on Tuesday the net profit was in contrast with a net loss of RM8.75mil a year ago. Its revenue, however, declined by 53.6% to RM119.15mil from RM256.95mil a year ago.
Earnings per share were 1.32 sen compared with loss per share of 0.67 sen.
“Despite lower revenue recognised, the group achieved a higher profit before tax of RM24.2mil as compared to loss before tax of RM2.8mil in the preceding quarter.
"The increase in profit before tax in the current quarter was mainly due to the fluctuation of the pound sterling against the ringgit which resulted in an unrealised exchange gain of RM23.1mil as compared to an unrealised foreign exchange loss of RM9.2mil in the preceding quarter, ” it said.
For the nine months, it posted net profit of RM8.09mil, down by 65.8% in the previous corresponding period's RM23.70mil. Revenue fell by 65.8% to RM390.56mil from RM636.33mil.
E&O said the lower group revenue was mainly due to the lower revenue by the property segment where revenue was RM339.4mil compared with RM569.5mil a year ago.
“This was due to lower revenue recognition from Seri Tanjung Pinang 1, namely The Tamarind and the Ariza Seafront Terraces which were completed in the previous financial year.
The group’s three joint venture projects, Avira in Medini Iskandar and The Mews and Conlay in Kuala Lumpur City Centre contributed a total revenue of RM67.5mil in the nine months ended Dec 31,2019 which was comparable to the total revenue of RM67.6 mil in the previous corresponding period.
As for the hospitality segment, revenue was lower at RM47.3mil compared with RM64.9mil a year ago.
“This was mainly due to the temporary closure of the heritage wing of Eastern & Oriental (E&O) Hotel from March to December 2019 for an extensive refurbishment exercise.
“The heritage wing re-opened for business in December 2019 with newly appointed suites, F&B concepts and secured bookings for the refreshed grand ballroom, ” it said.
On the prospects, E&O said with the property market remaining subdued, it was expecting slower property sales in the near term from both the local and foreign markets.
“Our Eastern & Oriental Hotel now has more diverse and complete offerings with the completion of the newly refurbished rooms and facilities of the Heritage Wing in December 2019. The recent Covid-19 outbreak has adversely impacted our hotel occupancy. However, the unique hotel offerings and experience will position the hotel well in the longer term, ” it said.