IGB Bhd’s net profit for the second quarter ended June 30, 2019 (Q2) slipped 20 per cent to RM32.86 million from RM41.27 million posted in the same period last year.
Revenue, however, improved eight per cent to RM317.06 million from RM293.50 million previously.
In a filing with Bursa Malaysia today, IGB said the increase in the group’s revenue was mainly due to higher contribution from the property development and property investment-retail divisions.
Moving forward, it said the property investment segment is expected to be more challenging in the near term with the scheduled increase in supply of new retail space and slower demand for office space in Kuala Lumpur.
“However, with the prime location of the group’s retail malls and office buildings, IGB expects contribution from this segment to be satisfactory,” it said.
In view of the current weak sentiment in the property development market, the company said 2019 would continue to be a difficult and challenging year for the property development segment.
The group saw a 10 per cent decrease in revenue for the hotel segment for the first half of this year to RM129.6 million, mainly as a result of lower average occupancy rates and lower average room rates achieved by a majority of the hotels in the group, it said.
“The hospitality sector was very competitive and hopefully the government’s efforts to promote tourism will contribute positively to the sector,” it added.