EASTERN & Oriental Bhd (E&O) experienced a significant decline in net profit for the fourth quarter ended March 31, 2023 (4QFY2023), with a drop of 79.64% to RM16.09 million compared to RM79.02 million in the previous year.

The decrease can be attributed to several factors, including higher selling and marketing expenses, and significant other expenses, it told the bourse in a filing today.

However, there was a positive note in terms of quarterly revenue, which increased by 15.15% to RM65.3 million compared to RM56.71 million in the previous year.

For the full FY2023, E&O recorded a net profit of RM44.55 million, representing a decline of 30.14% from RM63.76 million in FY2022, despite a substantial growth in revenue to RM318.07 million, a 126.39% increase from RM140.5 million.

The net profit was impacted by several factors, including a write-down of property development costs amounting to RM135.3 million, a forex loss of RM7.58 million compared to a forex gain of RM23.18 million in the previous period, a rise in cost of sales to RM154.16 million, a significant increase in other expenses to RM164.33 million, and a decline in other income to RM129.56 million.

In terms of future prospects, E&O’s MD, Kok Tuck Cheong, highlighted that the company’s project on Andaman Island phase one, The Meg, is fully sold, and their second project, Arica, which launched in March 2023, has received an encouraging response from buyers.

E&O’s shares fell by half a sen or 1.56% to 31.5 sen today, resulting in a market capitalization of RM488 million. – TMR