KUALA LUMPUR (May 18): Cash-rich MPHB Capital Bhd recorded a turnaround in the first quarter ended March 31, 2023, with a net profit of RM8.73 million compared to a net loss of RM314,000 in the corresponding quarter due to fair value gain from its financial assets.

At the same time, the continuing operations of MPHB recorded higher revenue of RM9.52 million compared with RM8.87 million in the corresponding quarter due to improved revenue in its hospitality business.

As a result, the group declared an interim dividend of 5 sen per share, which will go ex-date on June 1, 2023. Payment will be done on June 20, 2023.

Recall that MPHB disposed of its 51% stake in the general insurance business MPI Generali Insurance Bhd to Generali Asia for RM522.06 million back in August 2022.

One of the continuing segments of MPHB — the credit segment — saw its revenue decline RM300,000 to RM3.3 million during the quarter compared with a year ago due to lower interest income.

However, it achieved a profit before tax (PBT) of RM15.5 million during the quarter, which was a significant improvement from the loss before tax of RM300,000 in the corresponding quarter, due to the fair value gain and higher returns from its financial assets at fair value through profit and loss.

Meanwhile, the investment segment posted higher revenue of RM6.2 million in 1QFY2023 compared with RM5.3 million in 1QFY2022. The segment recorded a smaller LBT of RM1.3 million during the quarter, compared with RM1.4 million in 1QFY2022.

On prospects, MPHB said that the credit segment will continue its strategy to finance reputable niche clients with low-risk exposure, while the investments segment will continue to conserve and safeguard its resources whilst continuing to evaluate viable options to create long-term sustainable value in the land banks.

“The group may consider joint venture arrangements with niche reliable partners or outright disposal,” said MPHB.

The disposal of its stake in MPI Generali led to MPHB being cash rich. As at March 31, 2023, the group has RM265.18 million in cash and cash equivalents.

MPHB was traded at RM1 per share on Thursday, valuing the group at RM715 million.