IOI Properties eyes 25-35pc rise in net profit for FY19

Source: Malay Mail

PUTRAJAYA, Oct 31 ― IOI Properties Group is aiming for a 25 to 35 per cent growth in net profit in financial year 2019 (FY19), driven by strong demand for its projects in Malaysia, China and Singapore, said the group’s chief executive officer Lee Yeow Seng today.

He said the company is targeting sales of over RM3 billion for FY19, compared to RM2.8 billion last year, from new projects to be launched this year.

“The group will be launching properties both locally and abroad, and targets to achieve over RM3 billion in revenue this fiscal year. Overseas projects are expected to account for 60 per cent of the group’s net profit in FY19, while the remainder will come from local projects.

“Our overseas investments are doing well. In China, we launched a project in September last year and the response was quite good. We sold 96 per cent. We are confident our new launches in China will receive a very positive response,” he told reporters after its annual general meeting here today.

Explaining further, Lee said the group still has projects worth RMB4 billion (approximately RM2.4 billion) there to be rolled out over two fiscal years, which include mid- to high-rise condominiums and town villas in IOI Palm City, Xiamen.

In Singapore, he said, IOI Properties Group will be able to tap into the strong interest in prime Grade A office space for its Central Boulevard project that is strategically located within Marina Bay and the business district.

On Malaysia’s property market outlook, Lee, however, said the group does not expect the market to rebound too quickly until several fundamental problems, such as the oversupply of affordable housing and office space in the country, are sorted out.

Asked to respond to Finance Minister Lim Guan Eng’s call for property developers to lower house prices by up to 10 per cent with the sales and service tax exemption on construction services and building material costs, Lee said: ”We have to study and evaluate further. But the group’s upcoming projects are likely to trend higher instead. The 10 per cent price cut in selling price is challenging with labour and material costs on the rise. 

“We think that it’s healthier for our new launches to have a price increase, instead of a drop in selling price. Our house buyers who have bought earlier on would be upset,” he added. ― Bernama