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IOI Properties Group’s net profit more than doubled in 3Q FY2021

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IOI Properties

Press Release: IOI Properties Group’s net profit more than doubled in 3Q FY2021 

IOI Properties Group Berhad (IOIPG) recorded a strong financial performance for its third quarter ended  31 March 2021 (Q3 FY2021) with a net profit of RM178.9 million, which more than doubled from  RM83.6 million in the preceding year corresponding quarter. 

Its revenue and operating profit also showed significant improvement, mainly attributed to higher  contribution from the property development segment. IOIPG’s operating profit soared 72% to  RM208.1 million with revenue expanding 44% to RM579.0 million in Q3 FY2021 compared with the  preceding year corresponding quarter.  

For the property development segment in Malaysia, IOIPG’s effective and unique sales and marketing  campaign, which was designed to assist buyers to overcome the challenges of homeownership and realise  life-long dreams, received favourable response. This has led to strong sales performance in Q3 FY2021,  with profits to be registered in coming quarters. 

“Despite the on-going COVID-19 pandemic, the Group achieved exceptional performance in Q3 FY2021.  The overall business sentiment was subdued with the Movement Control Order (MCO) 2.0 imposed in  mid-January 2021. However, every member of Team IOI pushed forward and focused on achieving targets  and we defied the odds. All these are possible through the commitment and passion of Team IOI to  consistently deliver products and services that exceed expectations,” said IOIPG Chief Executive Officer  Dato’ Voon Tin Yow. 

He added that IOIPG would carry on with its dynamic marketing initiative while leveraging on the Home  Ownership Campaign to boost sales of well sought-after, mid-priced range products. These high-quality  products are built within integrated developments offering various amenities in flourishing areas such as  the Klang Valley (16 Sierra, Bandar Puteri Bangi, IOI Resort City, Warisan Puteri Sepang, Bandar Puteri  Puchong and Bandar Puchong Jaya) and Johor (Taman Kempas Utama and Bandar Putra Kulai) that are easily accessible and well-connected. 

Contributions from the property development segment were RM485.2 million in revenue and  RM182.3 million in operating profit in Q3 FY2021, which soared by 71% and 113% respectively from the  preceding year corresponding quarter. The sterling performance was mostly due to higher sales  contribution from operations in Malaysia and China, as well as advance progress work from on-going  residential development in China. 

The residential developments in IOI Palm City, Xiamen, China will continue to contribute to the Group’s  financial performance in the coming quarters. Meanwhile, IOI Palm City Mall, Xiamen has secured high  occupancy level with business expected to commence by the third quarter of 2021. 

The pace of construction progress of Central Boulevard Towers in Singapore has gained speed. However,  looking ahead, the Group expects further uncertainties due to the measures taken by the government of  Singapore to contain the recent wave of the COVID-19 pandemic. Leasing activities have commenced and  IOIPG has seen a strong response from the market. 

For the property investment segment, it contributed RM72.4 million in revenue and RM32.9 million in  operating profit in Q3 FY2021, which were RM8.5 million and RM7.2 million lower respectively against  the preceding year corresponding quarter. Meanwhile, the hospitality and leisure segment recorded a  decrease in revenue from RM35.4 million to RM19.1 million and operating loss increased from RM5.0  million to RM7.5 million in Q3 FY2021. 

The recovery of the property investment, and hospitality and leisure segments in Malaysia was dampened  when MCO 2.0 was imposed; and it is expected to be further impacted by the on-going MCO 3.0, which  commenced on 12 May 2021. Nonetheless, the property investment segment will continue to implement strategies in tenant retention. As at 31 March 2021, the Group has supported its tenants with rental relief  worth over RM55 million. To maintain its market share in retail, IOIPG will also leverage on its customer  loyalty programme and adopt digital innovation to enhance customer experience. 

Although the business environment remained challenging due to the pandemic, IOIPG’s performance in  the current year-to-date improved significantly. The Group’s revenue and operating profit rose by about  one-fifth to RM1.8 billion and RM719.3 million respectively in the current year-to-date of FY2021  compared with the preceding year corresponding period. The increase in revenue was mainly due to higher  contribution from operations in the Klang Valley and Xiamen, China. 

With the prolonged pandemic and persistent geopolitical tensions, the operating environment is expected  to remain challenging and uncertain. However, the Group will always manage its operations prudently and  professionally to ensure satisfactory performance in the coming quarters and at the same time, consolidate  its market position and strengthen its competitive edge to capture any opportunities that may arise when  the situation gradually improves.

— end of press release —

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