KUALA LUMPUR: Eco World Development Group Berhad (EcoWorld Malaysia) announced its results for 2Q 2024 today. Key highlights include the following: 

• EcoWorld Malaysia recorded RM2.18 billion sales in 7 months of FY2024, representing 62% of its FY2024 sales target. 

• The Group’s Iskandar Malaysia projects continued to outperform with RM1.33 billion sales achieved, representing 61% of total year-to-date (YTD) sales.

• A breakdown of the YTD sales achieved by revenue pillars as at 31 May 2024 is set out below: 

Revenue Pillar	RM’mil
Eco Townships	855	39%
Eco Rise	674	31%
Eco Hubs	235	11%
Eco Business Parks	420	19%
Total	2,184	100%

 

• Arising from the Group’s encouraging YTD sales, EcoWorld Malaysia’s future revenue has increased to RM4.03 billion as at 31 May 2024. 

• Revenue and gross profit for 2Q 2024 rose by 32.1% and 37.1%, respectively, compared to 2Q 2023. Gross profit margin also improved from 25.6% in 2Q 2023 to 26.5% in 2Q 2024.  

• The Group’s Profit after Tax (PAT) from Malaysian operations was 14.2% higher than 2Q 2023. PAT for 2Q 2024 (including EWI) was RM70.0 million, 11.7% higher than 2Q 2023. 

• For 2Q YTD 2024, the Group recorded PAT of RM139.7 million, an increase of 16.7% compared to 2Q YTD 2023. 

• As at 30 April 2024, net cash flows generated from operating activities amounted to RM470 million, more than 3 times the Group’s PAT and 95% higher than the amount generated in 2Q YTD 2023. 

• The Group’s net gearing ratio as at 30 April 2024 stands at 0.24 times, a decrease from 0.28 times in 1Q 2024. Cash balances (including deposits and short-term funds) stands at an all-time high of RM1.44 billion. 

• Based on the above performance, the Board of Directors has declared a 2 sen interim dividend in 2Q 2024 which is payable on 19 July 2024.

 

Comments on EcoWorld Malaysia’s performance by Dato’ Chang Khim Wah, President & CEO

EcoWorld Malaysia achieved RM2.18 billion sales in 7 months of FY2024, fuelled by robust demand for our projects in Iskandar Malaysia which contributed 61% of the Group’s total YTD sales. From a segmental perspective, all four of the Group’s revenue pillars performed strongly.  

Sales of residential homes under our Eco Townships pillar remain the largest segment with RM855 million recorded, of which 90% comprised upgrader homes priced above RM650,000. 

Our Eco Rise pillar is also fast gaining ground as a significant driver of the Group’s sales. In particular, the duduk series which was created to serve the needs of first time and young home owners have become increasingly popular. From only 2 parcels in the Klang Valley in 2020, we now have 7 duduk apartments spread across the Central, Northern and Southern regions, all of which have been well-received by the market. Take-up rates have been very encouraging as evidenced by the near sold-out success achieved by Sa.Young D’ Eco Botanic, our first duduk apartments in Iskandar Malaysia launched in October 2023. This led to more parcels being launched in the southern state, namely Santai D’ Eco Spring and Sa.Young 2 D’ Eco Botanic. Group-wide, the duduk series contributed RM612 million in sales up to 31 May 2024. 

On the commercial front, products under our Eco Hubs pillar have seen steady demand, recording YTD sales of RM235 million. These comprise a wide range of commercial units at our matured townships across all three regions, including strata shops and shop offices at our Eco Townships and strata offices at Bukit Bintang City Centre (BBCC). We are looking to expand this pillar in the coming months through a combination of sales and leasing opportunities, including the introduction of a new lifestyle F&B hub in Kuala Lumpur, Tuah 1895 at BBCC, among others. 

The Group is well-positioned to ride the current strong wave of demand in the industrial market, especially in the Southern region. Sales amounting to RM420 million have been recorded under our Eco Business Parks (EBP) pillar up to 31 May 2024 and demand shows no sign of slowing down.  

On 7 June 2024, we entered into an agreement to sell 123.14 acres of industrial land located within EBP VI to Microsoft Payments (Malaysia) Sdn. Bhd. (“Microsoft”) for RM402.3 million. This is the first sale for EBP VI in Kulai, Iskandar Malaysia and we are confident that the planned development of a data centre there by Microsoft will amplify demand for our other industrial products.  

The above sale attests to the effectiveness of our 3-pronged strategy to target the widest possible range of customers and investors under our EBP pillar. Through our off-plan sales of Cluster and Semi-Dee industrial units we are able to serve Malaysian investors and SMEs. For local and international mid- and larger-sized industrialists, we offer a wide range of customised built-to-suit factories designed to cater to their specific requirements. Finally, given our relatively sizeable industrial landbank and strong execution track record, we are able to meet the demand of global multinationals such as Microsoft for large tracts of industrial land with infrastructure completed. 

As our projects increase in maturity, backed by consistently strong sales, the Group’s ability to generate cash has grown. In the 1st half of FY2024, we generated RM470 million cash from operating activities – this is more than 3 times our Profit After Tax for the same period. As a result, our cash balances (including deposits and short-term funds) increased to its highest levels to date of RM1.44 billion, thus reducing our net gearing ratio to 0.24 times. This provides us with a substantial war chest to acquire more landbank which we are actively seeking, whilst also continuing to reward our shareholders with good dividend payments.