Eco World Development Group Berhad hits sales target of RM3 billion for FY2015
Kuala Lumpur: Eco World Development Group Berhad (EWB) today announced that the Group had met its sales target of RM3 billion set for the current financial year. EWB achieved total sales of RM3.016 billion for its financial year ended 31 October.
President & CEO Dato’ Chang Khim Wah said strong sales in the fourth quarter, which amounted to RM924.2 million enabled the Group to achieve its target.
The sales achieved in FY2015 came from four projects in the Klang Valley which contributed RM1.579 billion; six projects in Iskandar Malaysia which contributed RM1.213 billion and two projects in Penang contributing RM224 million to total Group sales.
Commenting on sales numbers in the Klang Valley, Chang said it was testament to the underlying strength and resilience of the central region and its surrounding areas which collectively have the largest population base and highest per capita income levels in the country.
“The Klang Valley remains the most important market for developers due to the depth and breadth of demand which exists here consistent with its position as Malaysia’s financial, business and economic heartland,” he said.
“The Group has also enjoyed sustained interest in all our developments in Iskandar Malaysia despite soft market conditions because of our wide variety of landed residential homes and commercial / industrial properties,” Chang added.
Up north in Penang, the Group’s latest launch on the mainland called Eco Meadows contributed the bulk of sales. “This indicates the growing popularity of this fast-rising locale following the opening of the Second Penang Bridge and the increased number of businesses and industries relocating to the mainland,” said Chang.
The Group recorded revenue of RM1.712 billion and gross profit of RM411.9 million with gross margins averaging 24% for FY2015. Ongoing projects which contributed to the revenue and gross profit achieved include Eco Majestic, Eco Sky and Saujana Glenmarie in the Klang Valley; Eco Botanic, Eco Spring, Eco Summer, Eco Business Park 1, Eco Tropics and Eco Business Park III in Iskandar Malaysia; and Eco Terraces on Penang Island.
Chang also shared that the Group has opened eight new EcoWorld Galleries this year, increasing the total to eleven as at end October 2015 as part of its ongoing branding and marketing initiative.
“Over the last two years we have invested heavily in building up the EcoWorld brand with the aim of connecting and reaching out to our customers and target markets more effectively. Now that we have 11 EcoWorld Galleries spread out in the Klang Valley, Iskandar Malaysia, Penang and Singapore, we are better able to showcase the full spectrum of our product offerings to prospective customers. These dedicated galleries are complemented by 5 large-scale Show Villages through which we have been able to demonstrate to our buyers what a Signature EcoWorld township looks and feels like,” said Chang.
Moving forward in FY2016, the Group expects sales to be underpinned by the launch of new phases and the introduction of new products within its on-going projects.
“We expect our launches to continue to perform well because of several factors. As part of the EcoWorld brand promise, all our 11 ongoing projects are strategically located in fast-growing or matured corridors with good accessibility to major highways, employment centres, educational and recreational amenities.”
“We also foresee continued strong demand for homes within well-planned gated and guarded communities offering products and design concepts which meet customers’ lifestyle needs and aspirations,” said Chang.
With a strong foundation established in the township segment of the property market, last month, the Group unveiled its most exciting integrated commercial development in the heart of Kuala Lumpur called Bukit Bintang City Centre (BBCC). A joint development with UDA Holdings Berhad and the Employees Provident Fund Board, registration of interest from the public has commenced in preparation for the maiden launch of its strata offices and serviced apartments during the first half of FY2016.
BBCC aims to revitalise the landscape of the city through the creation of a comprehensive new work, leisure and residential destination. This innovative urban regeneration project which is situated on a historic 19.4 acre site will be anchored by a one million sq ft retail mall offering specialty and renowned local and international brands, an exciting new entertainment hub and a Malaysian Grand Bazaar to showcase home-grown talents, arts & crafts.
BBCC’s unique entertainment offer will be complemented by six luxury residential towers, strata-offices, a 4-star hotel and an iconic 80-storey Signature Office Tower. In line with EcoWorld’s commitment to sustainability, green lungs have been threaded into BBCC’s design to enhance biodiversity and restore nature into urban inner-city developments.
Down south in Iskandar Malaysia the Group will be launching Eco Business Park II in FY2016 to continue to increase its share of this growing market segment in the Senai Corridor. This will be EcoWorld’s third fully gated and guarded business park in Iskandar Malaysia offering business owners and investors one-stop industrial solutions with modern facilities and services including high-speed broadband and space customisation options.
Apart from the two new projects Chang said EWB’s plans for FY2016 include completion of the acquisition of several sizeable parcels of lands announced earlier, and aims to finalise the masterplans for the developments proposed thereon namely:
- Eco Forest, a 493-acre township located 5km away from Eco Majestic to enable the Group to benefit from economies of scale of operations and build on the success of its flagship project in Semenyih;
- Eco Gardens and Eco Business Park V, a complementary township and business park development covering 2,198.40 acres in Mukim Ijok, Selangor. These twin-projects will enable the Group to establish a dominant presence in the up and coming North-Western Klang Valley growth corridor with access to a new market catchment where EcoWorld is currently not represented;
- Eco Marina a 300-acre development in Batu Kawan on mainland Penang which provides the Group with the opportunity to create a one-of-a-kind mixed residential, commercial, leisure and tourism project to take advantage of the site’s natural 2.5 km coastline on its north-western boundary and the 150-acre golf course which will be developed on its south-eastern flank.
On the corporate front, EWB also announced its plans to take up to a 30% stake in EcoWorld International Sdn Bhd (EWI)’s proposed Initial Public Offering (IPO), subject to the approval of the relevant authorities and the Company’s non-interested shareholders.
EWI is in the process of making an application to the Securities Commission for its proposed IPO and Listing. EWI currently owns a 75% stake in three projects in London, United Kingdom, namely Embassy Gardens Phase 2 located in the Nine Elms regeneration area, Wardian London situated next to Canary Wharf and London City Island Phase 2 on the Leamouth Peninsula in East London. It also owns one project in West Sydney, Australia called West Village, Parramatta. All four projects were launched in 2015.
President & CEO of EWI, Dato’ Teow Leong Seng said: “We are delighted with the response received not just from Malaysian customers but also global and home country buyers for every project. As at 31 October 2015 we have secured sales of $554 million – $437 million from the three projects in the UK and $117 million from Australia.”
Teow attributed the strong sales achieved to the care taken in site selection to ensure that all projects are in prime development zones with easy access to public transport and road networks, the unique and differentiated features of each development, the experience of the management team and the strength of the EcoWorld brand.
“We are deeply gratified that our buyers have given us such a resounding vote of confidence not just in Malaysia but also in London and Sydney. The success of both EWB and EWI in their respective markets has created a strong platform for mutual collaboration to position EcoWorld as a global property brand. This will give EWB a significant competitive advantage in promoting its Malaysian property projects to its customers,” said EWB’s Chairman Tan Sri Liew Kee Sin.
Pursuant to a Collaboration Agreement to be entered into between the parties, EWI will also be able to leverage on EWB’s strong customer networks to market its projects in the UK and Australia to Malaysian and Singaporean customers.
“By working together, EWB and EWI will be able to grow faster as well as deepen and broaden their technical capabilities and expertise in design and innovation. This will generate better insights and spur creativity for the creation of new products to the delight of the market. All this will set the stage for the EcoWorld brand to continue to grow from strength to strength,” Liew said.
Upon completion of EWB’s proposed acquisition of the 30% stake in EWI, it will be entitled to a proportionate share of the earnings arising from the sales secured by EWI.
Accordingly, EWB is maintaining its sales target at RM4 billion for FY2016. Sales for the upcoming year will be anchored by the Group’s 11 ongoing projects which are primarily in the landed township and business park segments, the proposed launch of Eco Business Park II and the Group’s proportionate share of sales from its 40% stake in BBCC and proposed 30% stake in EWI.