Press Release: IGB Berhad FY2018 Revenue increased by 6.5%

Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp

IGB Berhad FY2018 Revenue Increased 6.5%

Kuala Lumpur, 29 May 2019 – IGB Berhad held its 19th Annual General Meeting (AGM) at 2.30 pm in Klang Room, GTower today.

The financial statements for the year ended 31 December 2018 together with Reports of the Directors and Auditors were laid during the AGM.

IGB Berhad posted an increase of 6.5% in revenue for financial year ended 2018 (FY2018) despite a challenging year of economic uncertainty due to socio-political factors within the country and globally.

Revenue rose to RM1,302.0 million from RM1,222.3 million in financial year ended 2017 (FY2017).

Profit before tax decreased marginally by 2% to RM480.6 million from RM491.3 million, as the previous year’s result included a one-off gain of RM34.0 million from the sale of Renaissance Kuala Lumpur Hotel and higher finance costs incurred.

Profit after tax contracted 9.3% to RM391.5 million from RM431.8 million, which was partly attributable to a write-back of deferred tax of RM41.0 million in FY2017 which arose from the sale of Renaissance Kuala Lumpur Hotel that year.

However, net assets increased by 26.7% to RM3,435.0 million from RM2,710.8 million and net assets per share increased 12.1% to RM4.99.

The year 2018 was also noteworthy to IGB Berhad as it completed the acquisition for the remaining 26.6% equity interest in IGB Corporation Berhad making it a 100% wholly-owned subsidiary. IGB Corporation Berhad was subsequently de-listed in the same year.

The objective of the merger was to streamline the structure of the businesses and to have a more cohesive environment for its human capital towards effective development and growth within the Group.

As of to-date, the Group has interests and businesses across Asia, Australia, the United States of America and Europe, in commercial and residential properties, construction, hospitality, retail, education, waste and water treatment as well as information technology.

Overview by Segment

Commercial and Residential Properties

In the property development segment, its revenue recorded an increase of 63% year-on-year to RM166.8 million from RM102.3 million, and pre-tax profit significantly increased by 300% to RM102.8 million from RM25.7 million previously.

Despite the soft real estate market throughout 2018, units in Damai 15 and Bentong Hills were fully sold while remaining units in Seri Ampang Hilir and 328 Tun Razak were taken up. Also, approval was obtained in 2018 for the masterplan for 129 acres of land in Wangsa Maju to be developed into residential properties. Stonor 3 is expected to be completed in the second half of 2019.

The Group also completed and soft-launched a co-living space at Damai Residence in November 2018 under Millennium Living Sdn. Bhd. It is a hybrid accommodation that offers flexible rental contract catering to young adults.

On the property investment and management commercial segment, the occupancy for the Group’s office portfolio decreased slightly to 84.6% as at 31 December 2018 as compared to 87.4% (FY2017) due to the oversupply of office space and weaker demand.

2018 also saw a new addition to the Group’s portfolio namely Menara Southpoint in Mid Valley City, Kuala Lumpur with a confirmed tenancy of 54%. The total office lettable area within the Group increased to 3.8 million square feet.

Focus on maintaining rental rates, occupancies and providing customized incentives to prospective tenants are in the plans of the Group moving forward.


The construction arm of the Group continued to work on several large projects throughout 2018, namely Menara Southpoint, The Mall Mid Valley Southkey, St Giles Southkey and office blocks – Mid Valley Southkey North Tower and South Tower in Johor Bahru.

The Group will continue to endeavour to meet its deadlines without compromising quality nor standards even though external factors such as erratic weather conditions and difficulty in foreign labour employment persist.


It was quite a tough year for the hotel division as it recorded a 11% decline in its gross operating revenue to RM509 million and a drop of 14% in its gross operating profit (GOP) to RM215 million.

It was mainly due to an overall drop in tourists’ arrivals in the country and the increasingly competitive tourism environment. However, the overall GOP margin achieved for the year compressed marginally by 2% to 42% as a result of effective cost management and improvements in operating efficiencies.

In 2018, St Giles Heathrow in UK increased its number of rooms and The Court – a St Giles Hotel in New York closed for redevelopment. As at 31 December 2018, the Group’s total room inventory numbered at 5,248.

The Group is foreseeing an addition of 575-room from St Giles Southkey, Johor Bahru in 2020 when the hotel is scheduled to be opened.


As for the property investment and management retail segment, it was a tough year as the popularity of online shopping continued to grow and the opening of new malls in the Klang Valley contributed to an increasingly competitive landscape.

Nonetheless, the segment’s net revenue grew by 2.2% to RM529.5 million from RM518.3 million (FY2017) and its pre-tax profit rose by 4.2% to RM355.0 million from RM340.6 million (FY2017).

The largest contribution in this segment came from IGB Real Estate Investment Trust (IGB REIT), the owner of Mid Valley Megamall (MVM) and The Gardens Mall (TGM) of which both malls have stepped up their efforts to engage communities online besides the usual on-ground events as well as enhancing accessibility and connectivity in the shopping centres.

Another retail project called The Mall, Mid Valley Southkey in Johor Bahru with a net lettable area of 1.5 million square feet, opened its doors on 23 April 2019 and with 84.5% occupancy (as at 8 May 2019), it is expected to contribute significantly to the Group.


In 2018, the Group’s education arm, IGB International School became a fully accredited International Baccalaureate (IB) continuum school, the only international school in Malaysia authorized for all four IB programmes. This will enhance the school’s appeal and further increase its students’ intake.

Water Treatment

In other operating segments, the water treatment business in China performed well in 2018 due to the commencement of operations of Zou Cheng Phase 1 Upgrade and the revised water tariffs for the Yantai New Water Plant, however, rising operational costs due to elevating standards of waste water discharge by authorities and attracting talents remains a challenge.

Information Technology

For the Group’s IT business, AFMS Solutions Sdn Bhd expanded its services to include System Integration (SI) with several projects in hand throughout the year which will contribute positively in the near future.

In conclusion, 2019 will be another exciting year for IGB Berhad as the Group settles into its new structure with the benefits of its streamlined business model for synergized efforts towards opportunities, creating long-term values and enhancing returns for all stakeholders.

Copies of the Annual Report and Financial Report 2018 and Notice of Annual General Meeting 2019 along with related documents are also available on the Company’s website at

— end of press release —

Please LIKE FB page or Sign Up for free to get daily updates about the property market.

Next suggested article: Unexciting REITs? Well it gives stable returns 

We love to hear from you

You may enjoy these articles too. is everything about property related writings and news. Enjoy reading with a latte.

Leave a Replay

LIKE us for property news update, FREE.

LIKE us for property news update, FREE.

Property investment news everyday? Subscribe for free!

An article a day, keeps updated all the way.

Join 1,205 other subscribers

Property investment news everyday?

An article a day, keeps updated all the way. Subscribe for free!

If you are a Charles Tan fan, like this post