E&O dips back into the red in 4Q with RM75m net loss

KUALA LUMPUR (May 28): Eastern & Oriental Bhd (E&O) returned to the red after two quarters in the black, posting RM75.19 million in net loss for the fourth quarter ended March 31, 2021 (4QFY21) compared with a net profit of RM832,000 in the preceding quarter.

However, its revenue surged 281% quarter-on-quarter to RM139.2 million from RM36.5 million in 3QFY21.

Year-on-year, E&O marked a contraction in its net loss versus the corresponding quarter's net loss of RM204 million, while revenue increased 45% from RM96.2 million.

For the full FY21, net loss stood at RM73.2 million, 68% lower than its net loss of RM195.9 million a year earlier, while revenue fell 37% to RM304.7 million from RM486.8 million.

E&O attributed the decline in revenue to the properties segment which registered a decrease of RM131 million and the hospitality segment which saw a RM48.1 million decline in revenue.

"The decrease in revenue was mainly attributed to the imposition of various MCOs (Movement Control Orders) which restricted business activities during these periods," said E&O.

Meanwhile, the loss recorded for the period was due to impairment losses and write-down on the properties of RM133.8 million, versus RM209.6 million in the previous year, although this was mitigated by an unrealised foreign exchange gain of RM43.8 million for the current year, compared with RM1.3 million in the preceding year.

E&O said it is currently awaiting the approvals for a project in Damansara Heights, Kuala Lumpur and another in Seri Tanjung Pinang, Penang, which are expected to be launched in the latter part of 2021.

While it remains cautious of the current economic conditions, the group is hopeful the sale of the properties of these two projects will be encouraging, based on their strategic locations and the designs incorporated.

"Until the international borders are open and interstate travel is permitted, the hospitality division is not expected to recover in the immediate term from its current occupancy levels," it said.

E&O shares rose 5.5 sen or 7.64% to close at 77.5 sen for a market capitalisation of RM1.1 billion.

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