KLCCP Stapled sees four-fold rise in 4Q profit, declares 14 sen dividend

• Moving forward, KLCCP Stapled expects the healthy economic recovery to continue into 2023, supported by the stability of the office segment and the strong footing of its retail and hospitality segments.

KUALA LUMPUR (Jan 31): KLCCP Stapled Group Bhd has recorded a near four-fold rise in net profit to RM279.47 million for the fourth quarter ended Dec 31, 2022 (4QFY2022), from RM70.33 million a year earlier, boosted by strong recovery in the retail and hotel segments.

The group — comprising KLCC Property Holdings Bhd (KLCCP) and KLCC Real Estate Investment Trust (KLCC REIT) — saw its quarterly revenue increasing 18.69% to RM413.26 million, from RM348.17 million.

KLCCP Stapled declared a dividend of 14 sen per stapled security, bringing the full-year dividend payout to 38 sen per security or a total of RM686 million.

For FY2022 as a whole, KLCCP Stapled’s net profit grew 57.84% to RM782.66 million from RM495.85 million in the previous year, as revenue increased 24.61% to RM1.46 billion from RM1.17 billion.

The group’s retail segment (represented by Suria KLCC and the retail podium of Menara 3 Petronas) saw revenue increase 4.49% to RM125.37 million from RM119.99 million, as profit before tax (PBT) rose 11.04% to RM96.85 million from RM87.23 million, mainly driven by the higher rental revenue and advertising income, improved tenants’ sales which surpassed the pre-pandemic levels, and lower rental assistance to retail partners.

“Mandarin Oriental, Kuala Lumpur, which represents the hotel segment, recorded a robust performance with a two-fold increase in revenue from RM23.0 million to RM49.1 million,” said KLCCP Stapled in a bourse filing, adding that the improvement was mainly contributed by higher occupancy rate from the pent-up demand of high-yielding rooms and suites, and an increase in business demand for food and beverages and banqueting events.

“The office segment, comprising the Petronas Twin Towers, Menara 3 Petronas and Menara ExxonMobil, remained stable, as the iconic, high-quality assets are backed by triple net lease (TNL) and long-term leases. The segment recorded stable revenue of RM146.0 million, while PBT fell marginally to RM110.5 million due to preservation costs incurred for Kompleks Dayabumi,” said KLCCP Stapled.

Meanwhile, the group’s management services segment (comprising facility management and car parking management services), saw higher revenue of RM112.1 million compared with RM80.5 million a year earlier, while PBT improved significantly by 30% to RM21.5 million from RM16.6 million, thanks to completion of one-off works from the facilities management, and increased customer counts in the malls, contributing to higher car parking income.

Moving forward, KLCCP Stapled expects the healthy economic recovery to continue into 2023, supported by the stability of the office segment and the strong footing of its retail and hospitality segments.

But, the group remains cautious as headwinds such as inflationary pressures, rising labour costs, and the lingering pandemic will continue to persist.

“Suria KLCC will continue to drive innovative marketing programmes to bring more quality traffic into the mall, to drive sales for its retail partners.

“Mandarin Oriental will focus on delivering world class hospitality and (on) enhancing brand value, capitalising on the returns of tourists,” it added.

Shares of KLCCP Stapled closed up six sen or 0.86% to RM7.05 on Tuesday (Jan 31), giving it a market capitalisation of RM12.73 billion.