IOI Properties rides on economic recovery

PETALING JAYA: IOI Properties Group Bhd (IOIPG) says it is strongly positioned to ride out the storm from the ongoing macroeconomic and sectoral concerns caused by rising inflation, supply chain disruptions and interest rate hikes.

“For the coming financial year, we will focus on enhancing value with the aim of improving profitability by launching products with higher margins corresponding with the maturity of its land bank and infrastructure of its integrated developments,” it said in a filing with Bursa Malaysia yesterday.

The group reported its fourth quarter net profit ended June 30 rise of 147% year-on- year (y-o-y) to RM292.48mil while revenue for the quarter also rose 9% y-o-y to RM715.94m as it saw a strong recovery in the retail and hospitality segments in Malaysia since the full withdrawal of movement restrictions.

“The group is expecting higher recurring lease income from the opening of IOI City Mall Phase 2 scheduled for end August as it sets to be the largest mall in Malaysia with a net lettable area of 2.5 million sq ft.

“Along with the addition of more than 300 retail outlets, IOI City Mall will have over 700 retail outlets in total,” it said.

Meanwhile, with the refurbishment of two hotels, Putrajaya Marriott Hotel and Palm Garden Hotel, Putrajaya, the group is well poised to meet any increase in international and domestic tourism, it added.

The group’s property development segment recorded a revenue of RM561.1mil, a decrease by 3% compared to the preceding year corresponding quarter due to lower sales of properties in China.

Notwithstanding the slower sales in China, its operating profit rose by 37% to RM228.1mil compared to the preceding year corresponding quarter. This is mainly attributable to higher profit contributions from IOI Palm City, China and higher sales of commercial properties in Malaysia.

In the property investment segment, the group recorded a strong performance with an increase of 89% in revenue to RM51.3mil and a 109% y-o-y rise in operating profit to RM19.9mil on increase of footfall within the mall operations in Malaysia and higher retail spending. Recurring leasing income from the business commencement of IOI Mall, Xiamen, China in October 2021 has also contributed to the increase in the segment’s revenue and operating profit, IOIPG said.

Its hospitality and leisure segment’s revenue soared to RM42.4mil (up 124% y-o-y) on robust domestic demand and reopening of international borders.

“The transition towards endemicity continues to steer our nation towards a healthy recovery in all sectors of its economy. Hence, we are confident that this will bolster market and economic conditions which will augur well for all business segments across IOIPG,” said IOIPG CEO Datuk Voon Tin Yow.

Source: The Star