Hua Yang’s 1Q23 net profit drops 74.5%

As a result, the group registered a lower EPS of 0.06 sen for the period against 0.25 sen previously

by S BIRRUNTHA / Pic source from Hua Yang’s Facebook

HUA Yang Bhd’s net profit for the first quarter ended June 30, 2022 (1Q23), declined 74.52% to RM227,000 from RM891,000 a year ago on lower revenue.

The property developer reported that its quarterly revenue fell 29.27% to RM23.42 million compared to RM33.11 million in 1Q22, according to its filing to Bursa Malaysia today.

As a result, the group registered a lower earnings per share (EPS) of 0.06 sen for the period against 0.25 sen previously.

On a segmental basis, Hua Yang’s revenue for property development decreased by 31% while profit before tax (PBT) increased by 17% compared to the previous financial year of corresponding quarter.

“The decrease in revenue was due to lower sales achieved in Bandar U @ Seri Iskandar and Astetica Residence @ Seri Kembangan.

“The higher PBT was due to lower marketing expenses incurred for the current quarter under review,” the group said in the exchange filing.

For its other operations, the group achieved PBT of RM1.36 million compared to RM19.57 million in 4Q22.  

It attributed the lower PBT to the reversal of impairment loss on financial instruments in 4Q22.

No dividend has been declared for the quarter under review.

On prospects, Hua Yang noted that the Malaysian economy has become more robust with positive growth momentum supported by higher private consumption and investments since the reopening of the borders in April 2022.

The group said, however, the property market will remain tough and challenging due to geopolitical conflicts, escalating cost of building materials, supply chain disruptions and increase in Overnight Policy Rate by 50 basis point to 2.25%.

As a result of these disruptions, the group said it undertook a review of its overall business and operations strategies to ensure it has a balanced diversified property portfolio of landed and high-rise developments.  

“Apart from that, the group has also taken measures to improve its product design, to pace out new launches according to market demands, to closely monitor its risk management regimes, to strengthen its digital marketing tools and expand the digitalisation of its processes and procedures to improve efficiency and reduce cost,” it added.

The company added that it will continue to adopt a prudent approach in its business operations to stay resilient which include adapting its strategies and plans as part of its response in addressing the current business activity turbulence.

Hua Yang’s total unbilled sales at the end of the quarter under review stood at RM168.5 million.

The group has an undeveloped landbank of 159ha across key regions with an estimated gross development value of RM5.3 billion.

Shares of Hua Yang closed flat at 20 sen today, giving it a market capitalisation of RM72.16 million.