KSL ends FY14 with record profit of RM340 mil

KUALA LUMPUR (Feb 27): Johor-based property developer KSL Holdings Bhd has reported a net profit of RM129.8 million or 24.85 sen a share in the fourth quarter ended Dec 31, 2014 (4QFY14), from a loss of RM1.4 million previously.

Revenue also came in 46% higher at RM166.6 million, against RM114.1 million previously.

The group’s better performance in 4QFY14 was largely attributed to higher profit margin from favourable product mix and fair value gain amounting to RM88.2 million for its investment properties.

In addition, the loss in the previous year’s same quarter was impacted by a RM13 million deferred taxation for Real Properties Gain Tax.

For the full FY14, KSL reported a record net profit of RM340.2 million or 80.65 sen a share, which is 87.4% higher than RM181.5 million a year ago. Meanwhile, annual revenue surged 17.8% to RM801 million, from RM680 million in 2013.

“Our sturdy FY14 performance is a testament to our successful business strategy of growing both our property development and property investment segments, which noted healthy double-digit growth in the year,” said Ku Hwa Seng, chairman of KSL.

“With our pipeline property development launches of more than RM6 billion in gross development value (GDV) in the next five years, and continued marketing initiatives planned for the year, we are positive of sustaining our growth momentum, going forward,” he added.

KSL said its revenue from the property development segment rose 18.4% to RM643.1 million in FY14, against RM542.9 million in the previous financial year, on the back of sustained demand for affordable housing.

At the same time, revenue from property investments, led by the group’s integrated KSL City Mall and Hotel, rose 14.8% to RM154.6 million, on higher yield and patronage. Revenue from investment properties currently constitutes 19.3% of group revenue of RM801.2 million.

KSL has proposed a final single-tier dividend of 5 sen per share in respect of FY14, subject to shareholders’ approval in the upcoming Annual General Meeting. Existing shareholders can also opt to reinvest the final dividend under the Dividend Reinvestment Plan.

Together with the earlier-paid interim dividend of 5 sen per share, KSL has declared total dividends of 10 sen per share in respect of FY14.

According to KSL, the group’s ongoing developments on approximately 100 acres of land are worth a total GDV of RM3 billion, to last till 2017. Most of the projects are in Johor and Klang Valley.

Its pipeline projects from the balance land bank of 2,100 acres, have an estimated GDV of no less than RM30 billion in Johor and Klang Valley, set to sustain the group for at least the next 15 years.

KSL (fundamental: 2.6; valuation: 0.6) closed 16 sen or 6.81% lower at RM2.19, with a market capitalisation of RM2.22 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.)