BCorp returns to the black in 4Q

KUALA LUMPUR (June 30): Berjaya Corp Bhd (BCorp) posted a net profit of RM3.24 million for the fourth financial quarter ended April 30, 2017 (4QFY17), a stark contrast to a net loss of RM368.91 million a year ago due to impairment in value of goodwill of RM473.2 million plus and assets held for sale relating to Berjaya (China) Great Mall Co Ltd of RM131.81 million.

Quarterly revenue came in at RM2.23 billion, which was 10% lower from the RM2.48 billion it recorded a year ago. BCorp said the drop in revenue was caused by lower contributions from the property investment and development business segment.

“The property investment and development business registered lower revenue in the current quarter. This is because the remaining units of a property project in China have been disposed of in the third quarter of this financial year,” BCorp said.

“In the previous financial year, the sale of property units was high due to high demand after the Chinese government relaxed certain rules,” it added.

For the full financial year ended April 30, 2017 (FY17), BCorp also made a net profit of RM139.95 million against a net loss of RM177.22 million the year before. The annual profit was attributed to higher net profit from the property investment and development segment although it noted that this was dampened by decreased profits from its gaming operations.

Annual revenue in FY17 grew 1.3% to RM9.14 billion from RM9.02 billion in FY16, mainly attributed to higher contribution from the hotels and resorts segment as well as the property investment and development segment.

“The hotels and resorts business reported a higher revenue mainly due to revenue contribution from a new hotel which started operations in the month of October 2016,” BCorp said.

“The property investment and development business registered higher revenue mainly due to encouraging sales of apartments and higher progress billings from a property project in China in the year under review as well as the sales of several units of residences in Japan,” it added.

The motor distribution business under UK-listed luxury car distributor H.R. Owen PLC reported higher revenue contribution due to more revenue boosted by bigger sales volume of new cars, certain new models available for sale as well as contribution from additional outlets.

Also performing better in FY17 was the restaurant and cafe business, which generated higher revenue mainly due to additional cafes operating in the current financial year.

Meanwhile, the group said the marketing of consumer products and services segment reported lower revenue in FY17 compared with FY16 due to lower revenue reported by the retail distribution business, which was affected by weak consumer spending sentiment as a result of unfavourable economic conditions in China, Malaysia and Hong Kong.

This was further dragged by intense competition in China, it said.

Further, the group’s gaming operations reported lower revenue in FY17, no thanks to the additional Goods and Services Tax (GST) adjustment of RM15.6 million that Sports Toto Malaysia Sdn Bhd had made against its revenue pursuant to a notification from the Royal Malaysian Customs Department (RMCD) due to different interpretation on the value of gaming supply.

On outlook, BCorp said given the prevailing economic conditions and global financial outlook, its directors are of the view that “the group's operating environment will be very challenging going forward”.

BCorp settled unchanged at 35 sen yesterday, valuing it at RM1.68 billion. — theedgemarkets.com

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