KUALA LUMPUR (May 24): IOI Properties Group Bhd saw its net profit fall 54.8% to RM121.14 million or 2.72 sen a share in the third financial quarter ended March 31, 2017 (3QFY17) from RM267.96 million or 6.35 sen a share a year ago, mainly due to a one-off additional buyer stamp duty with interest of RM163.9 million incurred for the Trilinq project in Singapore during the current quarter under review.

Stripping out the additional buyer stamp duty and the fair value gain on investment properties of RM7.4 million, the group's operating profit was RM125 million or 58% higher than 3QFY16.

Quarterly revenue grew 39.2% to RM895.82 million in 3QFY17 from RM643.55 million in 3QFY16, derived from its three main business segments of property development, property investment and leisure and hospitality.

In a filing with Bursa Malaysia yesterday, IOI Properties said the property development segment recorded a 44% year-on-year (y-o-y) increase in revenue to RM777.2 million in 3QFY17, while operating profit fell 46% y-o-y to RM132.1 million mainly due to the additional buyer stamp duty.

"The increase in revenue was mainly contributed by higher sales take-up rate for Trilinq project, coupled with advanced progress work.

"In addition, the sales from IOI Resort City, Warisan Puteri @ Sepang and D3 Residence in Xiamen, China, continued to register favourable take-up rates, coupled with steady increase in progress works have contributed significantly to the increase," it added.

For the cumulative nine months (9MFY17), IOI Properties' net profit dropped 15.4% to RM584.23 million from RM690.6 million in 9MFY16, while revenue increased 40.2% to RM2.99 billion from RM2.13 billion.

Going forward, IOI Properties noted that the demand for properties in Malaysia is generally supported by a young population demographic, conducive interest rate environment and urbanisation.

"The group's property development segment is expected to contribute positively to its performance as evidenced by the demand for mid-priced properties at its township developments in Malaysia.

"On the international front, our development projects in Singapore and Xiamen, China, will continue to contribute positively to the group's results. The Trilinq project in Singapore had obtained the temporary occupational permit on April 6, 2017," it added.

In the property investment segment, IOI Properties said the strategic locations of the group's retail and office developments within matured townships and high growth corridors have enabled its property investment portfolio to enjoy healthy occupancies and rental yields amid an increasingly competitive environment.

"The retail and office segments are expected to continue to contribute positively to the group's performance," it said.

Barring any unforeseen circumstances, IOI Properties said it expects to perform well in the remaining financial period ending June 30, 2017.

IOI Properties shares closed 2 sen or 0.95% lower at RM2.08 yesterday, with 3.01 million shares done. Its market capitalisation stood at RM11.45 billion. — theedgemarkets.com

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