KUALA LUMPUR (May 31): MKH Bhd has reported lower net profit and revenue for its second quarter ended March 31, 2017 (2QFY17) mainly due to lower sales revenue and profit recognition from its property and construction segment.

Lower net gains on foreign exchange of RM1.7 million in the quarter had also dragged down net profit, which fell 10.84% to RM49.37 million from RM55.37 million a year earlier.

Meanwhile, revenue for the quarter slipped 13.7% to RM278.08 million from RM322.23 million a year earlier, according to the group’s filing with Bursa Malaysia today.

For the first half of FY17, MKH’s net profit fell 22.91% to RM90.16 million while revenue was down 8.41% at RM539.1 million.

The property and construction segment recorded lower revenue and net profit, mainly due to the absence of a government grant of RM11.7 million, and lower sales revenue and profit recognition following the handing over of vacant possession of MKH Boulevard, Pelangi Heights Phase 1 and 2, and completion of profit recognition on the sales of Pelangi Semenyih in the preceding six-month period.

Stringent lending guidelines, the weaker ringgit, and a slowdown in the property market were also reasons for the division’s poor performance, MKH said.

Meanwhile, the plantation division recorded higher revenue due to higher average crude palm oil (CPO) and palm kernel selling prices but lower profit before tax due to inclusion of unrealised foreign exchange gains in the six-month period.

Going forward, the MKH said it expects to perform satisfactorily due to profit recognition of its ongoing projects and contribution from the plantation division as more palm trees enter into maturity.

This would be coupled with higher yield and the anticipation in the increase in CPO and palm kernel prices, the group said.

Shares in MKH fell one sen to RM2.49 yesterday, giving the group a market capitalisation of RM1.06 billion. — theedgemarkets.com

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