E&O's net profit drops 56.5% to RM30.7m

KUALA LUMPUR: Property developer Eastern & Oriental Bhd (E&O) posted a 72% drop in net profit for 4QFY11 ended March 31 on the back of a lower contribution from its property division, due to lower revenue recognised, higher finance costs and pre-opening expenses incurred for its properties, Lone Pine Hotel and Straits Quay Retail.

For the quarter under review, net profit declined 72% to RM12.23 million from RM43.46 million the year before while revenue grew 58.1% to RM116.58 million from RM73.7 million.

For the full-year, net profit declined 56.5% to RM30.71 million from RM70.51 million, while revenue fell 23.44% to RM269.7 million from RM352.37 million. Earnings per share for the 12-month period dropped to 2.90 sen from 6.63 sen.

The company said the preceding year's higher revenue was driven by sales of completed units in Dua Residency and recognition of its Seri Tanjung Pinang projects.

It also noted that revenue amounting to RM160.02 million from two of its projects, St Mary Residences in Kuala Lumpur and ocean-side bungalows in Penang, had not been included in the consolidated results for FY11.

Commenting on its prospects for the current year, the company said: "The group expects an improved environment with the return of positive sentiments in the property market. We expect the launched property development projects such as St Mary Residences in Kuala Lumpur, Quayside condominiums at Seri Tanjung Pinang and existing developments in Penang to contribute positively to the group's earnings."

E&O stock ended four sen lower at RM1.49 on Monday. Its net assets per share stood at RM1.21 as at March 31.