PETALING JAYA: Eco World Development Group Bhd (EcoWorld Malaysia) and its associate company Eco World International Bhd (EcoWorld International) have posted a net profit for the third quarter ended July, 2020.
Eco World Malaysia recorded a net profit of RM13.8mil for the period, notwithstanding a decision made to write-down inventories by RM65mil.
Consequently, gross profit margins for the quarter was lower at 11.4%. Excluding the impact of the write-down, the gross profit margin would have been 25.1%, which is higher than the amount recorded in the corresponding quarter last year of 21.5%.
Rapid conversion of bookings following the re-opening of the group’s sales galleries on May 4 enabled RM1.25bil of sales to be secured in the four months immediately after the movement control order (MCO).
As at Aug 31, total Malaysian sales recorded in FY2020 amounted to RM1.58bil and the group’s effective share of future revenue from locked-in sales, including its share of EcoWorld International’s future revenue, stood at RM4.42bil.
The group said in a statement that future revenue from Malaysian projects alone remaineds very high at RM3.36bil.
It added that apart from providing clear earnings visibility, the bulk of the sales achieved are also backed by end-financing loans secured, which generated strong cash inflows.
Eco World Malaysia president and chief executive officer Datuk Chang Khim Wah said the prolonged MCO has been a blessing in disguise for the group in two important aspects.
He pointed out that one was the complete transformation of the customer landscape which allowed everyone to be reached and engaged with digitally.
“The second and in some ways an even more crucial factor is the tangible unique value proposition that each EcoWorld project is able to offer to the specific target market and customer segment we are reaching out to, ” he said.
Eco World International, which is a 27% associate company of EcoWorld Malaysia, posted a profit after tax of RM38.2mil in the third quarter mainly due to revenue and profit recognition of the its maiden project in Australia, West Village following completion and commencement of handover of units to customers.
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