TA Enterprise 3Q net profit rises 187% y-o-y

KUALA LUMPUR (Dec 17): TA Enterprise Bhd's third quarter ended Oct 31, 2012 (3QFY13) registered a 186.9% rise in net profit from the last corresponding quarter's, with RM33.65 million in net profit for this quarter and RM190.9 million in revenue.

In the last corresponding quarter, the group's net profit was RM11.73 million and its revenue was RM173.1 million.

In a filing to Bursa, TA Enterprise said all of its business divisions brought in higher contribution in this quarter, with the exception of its broking division.

"Pre-tax profit of the broking and financial services division decreased 48% to a profit of RM6.6 million in the current year's third quarter as compared to the previous year's corresponding quarter," the group wrote in the filing.

"Despite the drop of pre-tax profit, the division remains as the second largest profit contributor to the group."

The property development division registered a pre-tax profit of RM8.4 million. In the previous corresponding quarter, it raked in a meagre RM400,000 in pre-tax profit.

"Higher profit was contributed by the ongoing development projects in Damansara Avenue. This also explained the increase in current period-to-date pre-tax profit at RM14.8 million as compared to RM4 million last year," said TA Enterprise.

Its credit and lending segment contributed RM14.6 million in pre-tax profit to this quarter, versus a pre-tax loss of RM900,000 registered in the previous corresponding quarter.

The group said the rise in profit in this segment was due to active lending activities and lower foreign exchange translation loss on financial receivables in Australian Dollar.

TA Enterprise's investment holding division reported a pre-tax loss of RM3.4 million in 3QFY13, 47% less than a loss of RM6.5 million registered from the previous year's corresponding quarter.

The group said its pre-tax results had improved due to foreign exchange translation gain on US Dollar denominated borrowings, despite higher fair value loss on derivatives and higher finance cost.

Meanwhile, its property investment division made a pre-tax profit of RM5.1 million in this quarter.

Looking ahead, TA Enterprise said Malaysian economy has trended positively amidst the volatile external environment, and the possible deterioration of the Eurozone crisis.

"In view of the softening economic growth outlook in the US and China together with the uncertainties in Europe, the capital market is expected to be volatile and competitive. With the higher operating costs and thin brokerage rates due to stiff competition, the company will continue to strive to improve our competitiveness," the group said on its broking and financial services' prospect.

TA Enterprise said its local credit and lending segment will continue to gain business opportunities, with short-term corporate lending to continue growing at its current moderate level, while its property investment segment will bring a stable income from its local and overseas assets.