KUALA LUMPUR (May 23): WCT Bhd's net profit for 1Q ended March 31 climbed 7% from a year ago as it raked in higher revenue and booked more profits from jointly controlled entities.
Group net profit came to RM40.03 million in the quarter against RM37.39 million a year ago. Revenue rose 8% to RM341.57 million from RM315.61 million.
The group's income from construction, a major portion of which is derived from Malaysia, contributed to its revenue growth during the quarter. Construction made up 80% of WCT's total revenue.
Looking ahead, the group said property development and investments, besides hotel operations, are expected to have a greater prominence in its portfolio. It expects to derive more than 50% of its operating profit from non-construction businesses by 2016 compared with 36% in FY11.
"We are embarking on our next phase of growth through expanding our consumer-driven divisions in property development, and ownership and management of commercial properties such as shopping malls and hotels," it said, adding that this create a more balanced portfolio and revenue stream.
Contribution from property development is expected to grow in the next three financial years, helped by its projects in Johor's Iskandar Malaysia, as well as Shah Alam and Klang areas.
WCT is also building its own investment property portfolio to generate recurrent rental income to mitigate the impact of cyclical construction and property development earnings.
The group, which is launching its 91%-occupied Paradigm Mall in Petaling Jaya today, expects its rental income to grow further in 2013 when it starts to manage and operate the klia2 integrated complex.
WCT plans to construct its second hotel within its Paradigm mix-commercial development. It opened its first hotel in Klang in 2010.
This story appeared in The Edge Financial Daily on May 23, 2012.
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