EcoWorld Malaysia bullish on property market this year

KUALA LUMPUR: Eco World Development Group Bhd (EcoWorld Malaysia) is optimistic about the outlook for the real estate market this year, as it expects consumer and business confidence to be boosted by the reopening of the economy.

Executive Director, Chairman and Chief Executive Officer Datuk Chang Khim Wah said the group is hoping for an economic rebound in 2022 and is well positioned to “seize any opportunities that may arise”.

“Based on the group’s performance since the emergence of the EcoWorld brand and in particular the rebound in sales momentum we have experienced amid an ongoing pandemic, it is clear that real estate demand is specific to the location, project and product,” he said in the company’s latest annual report.

For 2022, Chang said EcoWorld Malaysia also intends to further increase its share of the industrial park market.

“Attractive tax and other incentives offered by the government to increase foreign as well as local private direct investment in key industries and service sectors are expected to help attract more businesses to set up shop in Malaysia once the international border for business travel will ease,” he added.

EcoWorld Malaysia recorded sales of RM3.52 billion in the fiscal year ended October 31, 2021 (FY21), 53% higher than the prior year and 23% above the target of 2 RM.88 billion he has set for the year.

The property developer recorded revenue of RM2.04 billion and gross profit of RM423.3 million in FY21, which were RM46.1 million and 91.8 million respectively. million RM higher than the EX20.

Its FY21 net profit jumped 14.1% to RM182.74 million from RM160.15 million a year ago, thanks to its Malaysian operations.

In a recent report, PublicInvest Research noted that EcoWorld Malaysia exceeded its FY21 sales target in August with sales of RM3.11 billion.

“The group sold 4,984 properties with a total sales value of RM3.52 billion in FY21, which is close to the all-time high of RM3.70 billion reached in FY17. , with 60% of new sales from the Central region, 31% from Johor and the remaining 9% from Penang.

“We understand that the sales performance of these three regions has significantly exceeded group targets,” the research house said.

PublicInvest Research said EcoWorld Malaysia expects sales momentum to continue by setting a new sales target of RM3.5 billion in FY22.

“It owns approximately 4,296 acres of undeveloped land with an estimated gross development value of RM62.5 billion,” he said.

The research house noted that the group’s unbilled sales fell from RM4.1 billion in the third quarter of FY21 to RM3.5 billion, due to lack of project launches.

“However, we believe that sales will pick up speed in the coming months. We understand that he sold properties worth RM376 million in November 2021 alone.

“The group’s balance sheet continued to strengthen, with cash and bank balances increasing by 72% year-on-year, while net borrowings fell by 27%, which saw its net debt reduced to 0.44 times.”

Separately, PublicInvest Research said the group’s international arm, Eco World International (EWI), achieved sales of RM1.38 billion in FY21, close to sales of RM1.38 billion. made the previous year.

“Share of earnings in joint ventures decreased by 73% year-on-year to RM47.2 million.

“This was partly due to the additional incentives given to buyers of completed units within the EcoWorld-Ballymore portfolio and higher commissions paid to agents to drive sales after the UK stamp duty holiday expired in June 2021.”

PublicInvest Research pointed out that EWI has set a sales target of RM2bil for FY22.

Penny D. Jackson