• The group’s property development segment’s revenue increased 42% to RM463.7 million from RM326.55 million a year earlier on higher level of work progress achieved for ongoing developments as well as sale of two parcels of industrial land in Bandar Rimbayu.

KUALA LUMPUR (Nov 30): IJM Corp Bhd’s net profit for the second quarter ended Sept 30, 2023 (2QFY2024) surged over threefold to RM93.69 million from RM27.03 million a year earlier, carried by strong showings from its property development and infrastructure segments.

Earnings per share climbed to 2.67 sen from 0.77 sen, according to the group’s bourse filing on Thursday (Nov 30).

Touching on the group’s topline, quarterly revenue jumped 36.05% to RM1.46 billion versus RM1.07 billion previously on the back of improvements across all its segments — comprising construction, property development, manufacturing and quarrying, infrastructure, as well as investment and others.

IJM declared a first interim dividend of two sen per share, with a Dec 15 ex-date, to be paid on Dec 18.

Most notably, IJM’s construction segment posted a 54.9% increase in revenue to RM416.15 million versus RM268.6 million previously, but profit before tax (PBT) dropped 37.3% to RM15.28 million from RM24.36 million previously as ongoing projects’ profit margins were negatively impacted by material and commodity price increase and prolongation cost, while new projects undertaken have yet to reach profit recognition.

Despite this, IJM’s property development and infrastructure segments carried the group’s improvement in profitability.

The group’s property development segment’s revenue increased 42% to RM463.7 million from RM326.55 million a year earlier on higher level of work progress achieved for ongoing developments as well as sale of two parcels of industrial land in Bandar Rimbayu.

The property development segment’s PBT increased 159.7% to RM76.18 million from RM29.33 million previously due to the higher revenue and profit margin derived from current portfolio mix of ongoing project and the aforesaid industrial land sale.

Meanwhile, the group’s infrastructure segment reported an 11.6% rise in revenue to RM242.36 million from RM217.15 million previously on higher port revenue arising from recovery of cargo throughput and higher ship revenue. The segment swung to a PBT of RM53.75 million versus a loss before tax of RM16.61 million on higher contributions from its port business and lower forex losses.

For the six-month period ended Sept 30, 2023 (1HFY2024), IJM’s net profit rose 221.55% to RM194.33 million from RM60.44 million a year earlier, as revenue increased 25.16% to RM2.68 billion versus RM2.14 billion previously.

Looking forward, IJM chief executive officer and managing director Lee Chun Fai said that with the improving macroeconomy and pick-up in construction activities, the group is well positioned to drive its growth agenda of growing its existing businesses, developing a portfolio in adjacent businesses and expanding its geographical footprint.

“IJM’s balance sheet, with a net gearing of 0.27 times, is expected to bolster the group’s credentials to undertake large-scale projects and strategic investments,” he said in a statement on Thursday.

According to the statement, the group’s construction order book replenishment prospects are encouraging and are supported by its outstanding order book of RM6.4 billion, which includes three recently secured construction contracts worth RM1.7 billion in the quarter under review.

“The property division (property development segment) maintains its commitment to offering compelling products, carefully tailored to align with market preferences across diverse price points. With unbilled sales of about RM2.5 billion and its ongoing efforts in introducing attractive packages with right product pricing, the property division is expected to deliver a strong performance in the near term,” the group said on its property development segment.

Touching on its infrastructure segment, IJM said its toll operations are expected to perform better in the current year (FY2024) with the absence of higher maintenance, such as resurfacing costs incurred in the previous year (FY2023).

“In line with the tariff increase which commenced in April 1, 2023 and the recovery of cargo throughput experienced in 1HFY2024, the group’s Kuantan Port operation is expected to deliver a better performance in the short term,” it added.

Shares in IJM ended five sen or 2.69% lower at RM1.81, giving the group a market capitalisation of RM6.6 billion.

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