The group has decided to delay the launches of Monterez project and Yakin Land’s developments to 2H21
by ASILA JALIL / pic by RAZAK GHAZALI
KERJAYA Prospek Group Bhd expects its construction segment to progress slower in its upcoming quarter due to stricter restrictions imposed across the country to curb the spread of Covid-19.
The group’s executive chairman Datuk Tee Eng Ho (picture) said construction activities have seen some delays in its fourth quarter of 2020 (4Q20), with the outlook for the property sector remaining bleak.
“Construction will keep moving, but we cannot do it like last year. Work will be slower, and there are standard operating procedures that we have to follow,” Tee said in a press briefing for its 3Q20 results yesterday.
The group has decided to delay the launches of new development projects, namely the Monterez in Shah Alam, Selangor, and Yakin Land Sdn Bhd’s developments in Kuala Lumpur to the second half of 2021 (2H21).
Tee said the group has to shut down its operations at Bukit Bintang City Centre (BBCC) for up to three weeks as they have been affected by Covid-19. Operations at the site will resume on Dec 2, 2020.
“This cost us between RM700,000 and RM800,000. But this is only in BBCC, so it does not affect us much because we still have other construction sites that are running,” he said.
The group’s net profit slipped 8% year-on-year (YoY) in its 3Q ended Sept 30, 2020, to RM30.38 million from RM33.01 million mainly due to the stall in construction work on-site as a result of the
Movement Control Order. Revenue fell 15.6% in the quarter to RM222.21 million against RM263.33 million in 3Q19, according to an exchange filing yesterday.
Kerjaya Prospek’s board of directors has approved an interim dividend of 1.5 sen per ordinary share. The proposed entitlement and payment dates are Dec 11, 2020, and Jan 6, 2021, respectively.
For the cumulative nine-month period, the group’s net profit declined 39.6% to RM62.77 million from RM103.91 million in the same period last year.
Revenue for the cumulative period was also down 28.6% YoY to RM562.15 million versus RM786.87 million due to the impact from the different levels of MCO implemented this year.
The construction division remains as Kerjaya Prospek’s largest turnover contributor, accounting for 99.5% of the revenue.
“With various adversities and challenging landscape, the group’s operations and financial performance are adversely impacted for the financial year ending Dec 31, 2020 (FY20), compared to FY19,” it stated.
The group’s balance sheet has net cash of RM182 million and a current ratio of 4.3 times as of Sept 30.
Following the gradual resumption of business activities, Kerjaya Prospek has recently bagged three contracts with a combined value of RM422 million, extending its year-to-date contract wins to RM1.4 billion.
This brings its current total outstanding orderbook to RM3.6 billion, which will provide earnings visibility for the next three years.
On the property development segment, the group’s Vista Residence project at Genting Permai was completed last year, and therefore, it has no project under development for the quarter under review.
The property development segment has a minimum contribution to the group’s results, it stated.
For the financial quarter under review, profit from the investment segment increased mainly from the gain on disposal of investment in foreign quoted shares of RM8.8 million.
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