EcoWorld Malaysia hits RM3.44bil sales in 10 months

EcoWorld Malaysia president and CEO Datuk Chang Khim Wah

KUALA LUMPUR: Eco World Development Group Bhd (EcoWorld Malaysia) has achieved RM3.44bil sales in 10 months, on track to exceed its full year sales target of RM3.5bil.

"The Group had a great three months from June to August 2022 which saw sales increasing by RM1.27bil. As a result, we managed to reach 98% of our full year sales target in just 10 months of the financial year ending Oct 31 (FY22),” president and CEO Datuk Chang Khim Wah said in a statement.

“Every region and market segment performed well. Projects in the Klang Valley recorded RM660mil, Iskandar Malaysia contributed RM445mil and Penang achieved RM165mil in sales during the 3-month period,” he added.

Chang said its industrial segment in particular had grown from strength to strength.

“Collectively, Eco Business Parks I, II, III, and V in Iskandar Malaysia and the Klang Valley have achieved total sales of RM730mil in just 10 months. This is already 151% higher than our FY21 full year industrial sales and it is reflective of the solid 8.9% growth recorded by the Malaysian economy in the second quarter of 2022.

“We are especially pleased that demand from local industrialists have continued to increase and following the border re-opening on April 1 we are also seeing good demand from Singapore-based industrialists at our business parks down south,” he added.

In the third quarter ended July 31 (3Q), EcoWorld Malaysia’s net profit jumped 32% to RM46.4mil, or 1.58 sen earnings per share against RM35.15mil, or 1.19 sen a year ago.

Revenue, however, was 1.1% lower at RM443.97mil from RM448.9mil a year prior.

The group’s share of the results of its Malaysian joint ventures (JV) in 3Q 2022 of RM27.2mil was higher by 123.5% as compared to 3Q21, driven by higher site progress and realisation of cost savings of completed and near completion phases.

EcoWorld Malaysia recorded a share of loss of RM12mil in Eco World International Bhd (EcoWorld International) in 3Q22.

It said this was due to lower profit contribution from Australian projects following substantial handovers in FY21 and revision of profit margins on JV projects in the United Kingdom in 3Q22.

EcoWorld Malaysia said its gross and net gearing levels reduced to 0.55 times and 0.35 times respectively.

The developer also reduced its bank borrowings to RM2.6bil versus RM2.9bil at the start of FY22. It also increases its cash and bank balances to RM954.3mil against RM784.7mil at the start of FY22.

The group’s near-term earnings visibility has also improved with future revenue increasing to RM4.2bill ion as at Aug 31.

“Based on EcoWorld Malaysia’s stronger balance sheet and improved cash position, the board has declared a second interim dividend of 1 sen per share in the current quarter. This brings total dividends declared to date for FY22 to 3 sen per share,” it said.

For the first nine months, EcoWorld Malaysia posted a net profit of RM155.43mil, up 11.1% from RM139.9mil, while revenue rose to RM1.48bil against RM1.38bil.

On its prospects, Chang opined that it is bright as reflected in EcoWorld Malaysia’s improving financials, cash position, and balance sheet as at July 31, and its high future revenue position of RM4.2bil as at Aug 31, which gives it clear future earnings visibility.

“Based on what has been achieved to date, we have been able to declare a first and second interim dividend totalling three sen per share to our shareholders.

“We still have another two months of our financial year to go and are positioned to close FY2022 strongly as we continue to pursue our objective of enhancing value for all our stakeholders.

“Our remaining undeveloped landbank of 3,731 acres also remains sizeable. However, in the event a good opportunity arises in the near to mid-term, we are well-positioned to take advantage of it to enhance our future growth prospects, given our current low gearing levels,” Chang said

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