Mitrajaya 2Q net profit drops 55% on lower construction contribution

KUALA LUMPUR (Aug 29): Mitrajaya Holdings Bhd’s net profit dropped 55% to RM13.21 million or 1.97 sen per share for the second quarter ended June 30, 2017 (2QFY17) from RM29.63 million or 4.6 sen per share a year earlier, on lower contribution from its construction segment.

The division saw a 93% plunge in pre-tax profit to RM2.2 million in 2QFY17 from RM32.6 million in 2QFY16.

Quarterly revenue, however, rose 24% to RM304.47 million from RM245.56 million in 2QFY16.

In a filing with Bursa Malaysia yesterday, Mitrajaya said the property development division posted a pre-tax profit of RM7.29 million in 2QFY17 compared with a pre-tax loss of RM1.35 million in 2QFY16 as revenue surged 145% year-on-year to RM34.88 million.

The profit was also partly due to the payment for compensation of RM2.11 million due to a compulsory land acquisition at Pengerang, Johor.

For the cumulative six months (1HFY17), Mitrajaya’s net profit fell 13% to RM41.94 million from RM48.08 million a year earlier, even though revenue jumped 35% to RM595.9 million from RM441.05 million in 1HFY16.

The group expects lower profit from its construction division for the financial year ending Dec 31, 2017 (FY17), amid additional cost to comply with stringent requirements related to safety for oil and gas projects.

However, it still expects a significant chunk of revenue contribution from the division.

It expects higher contribution from the property development division this year, as its Wangsa 9 Residency development continues to progress. Mitrajaya has unbilled sales of RM232.55 million as at end-2QFY17.

On its investment in South Africa, the developer said works to develop the remaining land has been ongoing since 2014, and is expecting better contribution in the coming financial years.

Its unbilled sales of rand 44.88 million (RM14.81 million) will be recognised progressively upon completion of the transfer of stands and houses to the purchasers in the second half of 2017 and early 2018.

Mitrajaya shares fell one sen or 0.75% to close at RM1.33 yesterday, with 253,000 shares done, giving it a market capitalisation of RM916.05 million. — theedgemarkets.com

For more stories, download TheEdgeProperty.com pullout here for free.