IOI Properties's 2Q net profit triples on higher share of results from JVs

KUALA LUMPUR (Feb 24): IOI Properties Group Bhd saw its net profit surged more than three-fold to RM401.98 million in the second quarter ended Dec 31, 2022 (2QFY2023), from RM125.72 million a year ago, lifted by significant improvement from the results of joint ventures (JVs).

Share of results of JVs shot up to RM225.82 million in 2QFY2023, compared to RM58.93 million in the same period of the prior year.   

Nonetheless, IOI Properties said its underlying profit before taxation (PBT) dropped 15% to RM280.6 million (excluding reversal of inventories previously written down of RM192.7 million included in share of results of JVs) in 2QFY2023, from RM331.3 million (excluding fair value loss on an investment property) a year ago.

Quarterly revenue, however, declined by 4.88% to RM670.44 million, from RM704.83 million a year prior, due mainly to lower performance from property development.   

No dividend was declared for the quarter under review.  

For the first half of FY2023 (1HFY2023), IOI Properties' net profit also jumped more than three times to RM1.04 billion, from RM334.54 million a year ago, while revenue rose 19.83% to RM1.36 billion, from RM1.14 billion.   

Commenting on the group's result, IOI Properties executive vice-chairman Lee Yeow Seng said in a separate statement that though uncertainty on the economy lingers, IOI Properties continues to forge ahead in all of its business segments, supported by the increase in demand for its wide product offerings and recurring earnings from various matured property investment portfolios, as well as improving prospects for the tourism sector.

The group's property development segment achieved commendable sales of RM926.6 million for 1HFY2023, of which local projects contributed RM796.6 million, which is 86% of total sales, while overseas projects from China and Singapore contributed RM130 million, or 14% of total sales.

On prospects, IOI Properties said the reopening of China following a dramatic pivot from a Covid-zero policy bodes well for the global economy.

"After close to three years of restricted movement, there is a renewed interest for property purchase as IOI Palm City and IOI Palm International Parkhouse registered marked improvement in footfall and enquiries for its developments. Furthermore, marketing campaign in conjunction with the new financial policies rolled out by the Chinese government are anticipated to drive sales of completed developments in Xiamen," said IOI Properties.

Over in Singapore, the group said the construction of IOI Central Boulevard Towers is progressing well and the "Grade A" commercial development is slated for completion in 2023.

"In addition to the internationally renowned anchor tenant secured earlier, there is a growing requirement for 'Grade A' office space from multinational companies and we are well positioned to capture this growing demand.

"As for our site at Marina Bay, we are in the midst of preparing for the development and sale plan for the mixed residential and hotel development," it added.

IOI Properties closed one sen or 0.88% at RM1.12, valuing the group at RM6.17 billion.

Source: The Edge