E&O's 3Q profit falls 40.2% to RM11.4 mil

KUALA LUMPUR (Feb 27): Eastern & Oriental Bhd (E&O) saw its net profit for the third quarter ended Dec 31, 2014 (3QFY15) fallen 40.25% to RM11.39 million, from RM19.06 million a year ago, despite a marginal increase in revenue by 1.67% to RM99.42 million.

Earnings per share (EPS) was lower at 1.02 sen, compared to 1.72 sen a year earlier.

For the nine months to Dec 31, 2014 (9MFY15), net profit was down 17.77% to RM51.59 million, from RM62.74 previously. This translated into a lower EPS of 4.65 sen, compared to 5.67 sen a year earlier.  

Nevertheless, 9MFY15 revenue was up 14.58 % to RM306.46 million, from RM267.45 million.

In a filing with Bursa Malaysia, E&O (fundamental: 1.2; valuation: 1.35) attributed the higher revenue in the nine months period to increased activities in its property segment.

On prospect, E&O said the Malaysian property market has experienced a general dampening in sentiment, amid a challenging market environment due to government's cooling measures and tightening of credit, coupled with declining oil prices and a weakening ringgit.

“Marketing efforts and strategies have been implemented to pursue product differentiation and promote E&O’s distinctive offerings to potential buyers, which are to garner positive response and [to] reaffirm the long term value proposition of the E&O brand,” it added.

E&O closed at RM2.25 today, down 3 sen or 1.31%, giving it a market capitalisation of RM2.82 billion.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)