Glomac says 3Q profit fell as property development business hit by MCO

KUALA LUMPUR (March 30): Property developer Glomac Bhd has said its earnings for the third quarter ended Jan 31, 2022 (3QFY22) slipped as revenue was impacted by the Movement Control Order (MCO) and a weaker market sentiment.

The group said net profit dropped 32.54% to RM8.12 million from RM12.04 million in 3QFY21, as revenue fell 17.82% to RM81.67 million from RM99.39 million.

On a quarter-on-quarter basis, net profit was down 29.51% from RM11.52 million in 2QFY22, despite revenue rising 8.33% from RM75.39 million.

For the cumulative nine-month period ended Jan 31, 2022, Glomac's net profit eased 6.29% to RM21.37 million from RM22.81 million in the same period a year earlier, while revenue declined 25.9% to RM185.9 million from RM250.87 million.

Glomac said revenue from the property development segment declined mainly due to the restricted physical construction work for ongoing project phases during the MCO which impacted the progress of construction work.

"Nevertheless, new launches and ongoing phases such as Saujana Perdana located in Bandar Saujana Utama, Plaza @ Kelana Jaya, 121 Residences, Lakeside Boulevard and Sri Saujana in Johor contributed to the revenue for the period," the group said in a bourse filing.

As for its property investment segment, which mainly comprised car park rentals and mall rental income, Glomac said quarterly and cumulative year-to-date revenues decreased by 6% and 23% respectively compared with in the previous corresponding periods.

"Revenue for this segment was challenging as the industry was adversely impacted by Covid-19 and various phases of MCO," it said.

In a separate statement, Glomac said the group's near-term focus is to further drive sales of its ongoing projects as well as the new launches coming on stream.

"Concurrently, Glomac will continue to take steps to strengthen its online presence and digitalisation process to enhance its sales and marketing strategies.

"Reopening of the economy has been much welcomed and has given a boost to consumer optimism. Nonetheless, challenges remain with global geopolitical issues and growth risks potentially weighing on our domestic economic recovery and impacting market sentiment," it said.

Looking ahead, Glomac said it is well positioned to accelerate its launches and introduce new development products when market conditions are more conducive.

"The group's balance sheet remains healthy, and it can potentially tap into its strong portfolio of prime development landbank with potential estimated gross development value of RM8 billion to further fuel its development activities," it added.

Glomac's share price settled for the day 1.56% or half a sen higher at 32.5 sen, giving the group a market capitalisation of RM249.62 million.

Edited by S Kanagaraju

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