E&O in no rush to sell UK assets

• The group’s remaining UK assets could fetch between RM600 million and RM800 million if fully monetised.

KUALA LUMPUR (May 28): Eastern & Oriental Bhd (KL:E&O) said it is "not in a hurry" to sell its properties in the UK, as it keeps the doors open to potential suitors to monetise the non-core assets.

“We are not in a hurry to sell those properties—although they remain non-core—unless the market changes,” its managing director Kok Tuck Cheong said at a financial results briefing on Wednesday.

"The good thing is that we are not under pressure to sell,” Kok said. “We are talking to various parties to see how we could either divest, [form a] joint venture or even develop if our current negotiation does not materialise. There is always a backup plan."

The group’s remaining UK assets could fetch between RM600 million and RM800 million if fully monetised, he added.

Kok noted that following the sale of ESCA House in Bayswater, E&O netted sales of £13 million (RM75 million), and it currently holds two properties in London—54-unit Lincoln Suites, Princes House along Kingsway near Covent Gardens and a 1.3-acre vacant site in Hammersmith.

RM2 bil launch pipeline for FY2026

E&O is planning to launch four projects with a combined gross development value of no less than RM2 billion in the financial year ending March 31, 2026 (FY2026).

In FY2025, the group recorded property sales of RM842.7 million with unbilled sales standing at RM1.5 billion. Penang contributed the most at 64% of all its property sales, followed by Klang Valley (31%) and Johor (5%).

Kok is optimistic that the property market in Penang remains promising due to three key factors: an increase in foreign direct investments, a rebound in tourism supported by direct flights and airport expansion, and the proposed establishment of a Penang International Financial Centre.

“We’re not saying we will be the recipient of this opportunity, but we certainly can raise our hands,” Tee said.

E&O’s confidence is underpinned by improving fundamentals—its net profit for the fourth quarter ended March 31, 2025 (4QFY2025) jumped 91.48% to RM69.85 million or 2.81 sen per share, from RM36.48 million or 1.87 sen a year ago, on the back of a 95.06% rise in revenue to RM236.66 million, from RM121.33 million, its bourse filing showed. 

For the full year, net profit rose 26.2% year-on-year to RM168.65 million from RM133.61 million, while revenue surged 75.3% to RM741.08 million from RM422.83 million, thanks to ESCA House sale and sales from existing projects.

E&O’s net gearing rose to 0.62 times as at 4QFY2025, from 0.51 times a year ago, due to an increase in borrowings and a reduction in bank balances.

On the other hand, it had cash and bank balances of RM278 million as at 4QFY2025, down by 28% from RM385 million a year before.

Shares in E&O settled 2.5 sen or 3.1% higher at 83.5 sen on Wednesday, valuing the group at RM2.09 billion. Over the past one year, the group has fallen 20%.

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