Land & General posts stronger 2Q financial results


Land & General attributed the stronger revenue largely due to the completion and handing over vacant possession of Astoria Ampang Phase 1 and Sena Parc Phase 1A during the quarter.

KUALA LUMPUR: Land & General Bhd reported stronger financial results in the second quarter ended Sept 30 with pre-tax profit of RM21mil on a revenue of RM51.90mil.

L&G, an established township developer in Bandar Sri Damansara, announced on Monday pre-tax profit rose by 313% on-quarter and 192% on-year. L&G's revenue increased by 253% on-quarter and 32% on-year.

“Pre-tax profit boosted by write-back of impairment loss on amount due from its Australian operations of RM9.8mil but partially offset by additional provision of RM2.7mil relating to its investment in a quoted stock on the Australian Exchange, ” it said.

It attributed the stronger revenue largely due to the completion and handing over vacant possession of Astoria Ampang Phase 1 and Sena Parc Phase 1A during the quarter.

As for its net profit, it jumped by over 700% to RM14.07mil from RM1.74mil a year ago.

L&G said in the first half, its net profit increased by 290% to RM19.51mil from RM4.99mil a year ago – mainly due to strong performance in the second quarter. Its revenue however, declined to RM66.65mil from RM83.62mil.

On the 2Q results, AllianceDBS Research said on Tuesday that stripping out write-backs of RM11.3mil, L&G reported 2QFY21 core earnings of RM2.8mil.

“This takes its 1HFY21 core profit to RM3.6mil that makes up 53% of our full-year projection, ” it said.

Alliance DBS Research said following the easing of lockdown measures, the company reported better 2QFY21 revenue of RM52m, representing a strong growth of 253% q-o-q and 32% y-o-y.

It also said the revenue growth was largely due to the completion and handing over vacant possession of Sena Parc phase 1A and Astoria Ampang phase 1 during the quarter. The property segment contributed 87% of its quarterly revenue.

L&G achieved strong property sales of RM30mil in 2QFY21 which is also the highest in two

years, thanks to its Damansara Seresta project. This brings its 1HFY21 property sales to RM38mil, which is on track to hit the research house's FY21 assumption of RM91mil.

“Unbilled sales dropped to a multi-year low of RM89mil, following the completion of several projects during the quarter, ” it said.

AllianceDBS Research said the company only launched the second phase of Damansara Foresta called Damansara Seresta (RM480mil gross development value) in 2HCY18 in view of the sluggish property market.

“We believe most of its pipeline will be further delayed until there is a turnaround in the operating environment. The delay has derailed L&G’s earnings growth momentum. A strong sales performance from Damansara Seresta will be critical to sustain its earnings growth given the declining trend of unbilled sales, ” it said.

The research house notedt that while the property market remains mired with challenges, the company's healthy balance sheet with a low net gearing level of 9% as at end-2QFY21 will help to tide over this difficult period.

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