IOI Properties Group Berhad (“IOIPG”) recorded a notable increase of 20% in revenue to
RM1.36 billion for the first half of financial year 2023 (“1H FY2023”) which ended on 31 December 2022 compared to the RM1.14 billion revenue recorded a year earlier largely due to the marked improvement of all business segments.
In a Statement, IOI said The profit before tax (“PBT”) for 1H FY2023 rose 136% to RM1.16 billion from RM493.6 million, whereby the property development segment remains as the Group’s biggest contributor and this is partially attributable to the higher share of results of joint ventures in the latest quarter of FY2023 which has included the reversal of inventories previously written down.
Other than that, the higher PBT is also attributed to the strong performance generated by the property investment segment and turnaround of the hospitality and leisure segment.
“We are delighted with the resilient effort of Team IOI in achieving commendable results over the first six months of FY2023. Though uncertainty on the economy lingers, IOIPG continues to forge ahead in all of our business segments, supported by the increase in demand for our wide product offerings and recurring earnings from various matured property investment portfolios, as well as improving prospects for the tourism sector. These will provide us with a strong foundation to assure unstained earnings for the Group,” added Mr Lee Yeow Seng, Executive Vice Chairman of IOIPG.
The property development segment achieved commendable sales of RM926.6 million for 1H FY2023. Local projects contributed RM796.6 million, which is 86.0% of the total sales while overseas projects from China and Singapore contributed RM130.0 million, or 14.0% of the total sales.
On the Malaysian front, the sales secured were largely from Klang Valley area at RM473.4 million, led by our integrated development at IOI Resort City in Putrajaya and our matured township at Bandar Puteri Puchong in Selangor, whereas the sentiment in Johor continues to surge with sales of RM305.5 million, led by the established township at Bandar Putra Kulai and the vibrant township at Taman Kempas Utama.
” Amid the challenging external environment, the property development segment continues to witness encouraging demand for our product offerings, especially the mid-priced range residential units.”
“In view of this, we will continue to meet the needs of the market by ensuring cost effectiveness throughout our developments, allowing for the delivery of competitive mid-priced ranged homes,” said Dato’ Voon Tin Yow, Chief Executive Officer of IOIPG.
The Group’s strategy is two-pronged: to launch new products with sustained margin as well as a concerted effort to clear completed inventories by leveraging on our “Trusted.” Brand and our proven promotion campaigns to drive sales.
Dato’ Voon added, “The launch of ‘101 Happy Moments’, a grand and innovative marketing campaign that spans throughout our townships, has transformed our IOI Galleria showrooms into fun and exciting hubs for surrounding communities as well as showcasing our latest developments.” IOI City Mall Phase 2 has successfully capitalised on higher retail activities in tandem with a general resurgence throughout the economy. In the short few months since its opening in August 2022, the mall has not only attracted footfall from Klang Valley but also from the towns of Nilai and Seremban. As the occupancy rate progressively improves, this will augur well for the property investment segment.
IOIPG’s hotels in Malaysia as well as the JV-owned JW Marriott Hotel in Singapore have registered vast improvement in the occupancy rates. Other than that, average room rates were boosted by the increase in tourist arrivals. The lifting of travel restrictions after China relaxed its Covid-zero policy and with more incentives to boost the tourism industry in place, our hospitality and leisure segment is poised for a better year ahead.
The reopening of China following a dramatic pivot from a Covid-zero policy bodes well for the global economy. After close to 3 years of restricted movement, there is a renewed interest for property purchase as IOI Palm City and IOI Palm International Parkhouse registered marked improvement in footfall and enquiries for its developments. Furthermore, marketing campaign in conjunction with the new financial policies rolled out by the Chinese government are anticipated to drive sales of completed developments in Xiamen.
Over in Singapore, the construction of IOI Central Boulevard Towers is progressing well and the “Grade A” commercial development is slated for completion in 2023. In addition to the internationally renowned anchor tenant secured earlier, there is a growing requirement for “Grade A” office space from multi-national companies and we are well positioned to capture this growing demand. As for our site at Marina Bay, we are in the midst of preparing for the development and sale plan for the mixed residential and hotel development.