KUALA LUMPUR (May 31): Berjaya Corp Bhd's (KL:BJCORP) net profit in the third quarter jumped over 200 times to a nine-year high, thanks largely to divestment and accounting gains.

Net profit totalled RM694.58 million for the third quarter ended March 31, 2024 (3QFY2024), compared to RM3.26 million over the same period a year ago, Berjaya said in an exchange filing. The company booked a RM497.91 million gain on disposal of its subsidiary company during the quarter.

The company also recorded a gain of RM154.05 million on remeasurement of retained equity interest in a former subsidiary company. Earnings per share jumped to 12.08 sen in 3QFY2024, from 0.06 sen in 3QFY2023.

Revenue for the quarter, meanwhile, climbed 11.24% year-on-year to RM2.78 billion from RM2.5 billion, led by higher property and lottery sales.

No dividend was declared for 3QFY2024. 

Moving forward, Berjaya said the performance of its domestic business segments is expected to improve on the back of strong consumer spending and improvement in tourism activities.

As for its gaming business, the company reiterated that the closure of legal lottery outlets in Kedah and Perlis will result in the proliferation of illegal operators in these underserved areas, it said. 

The strong quarterly performance lifted BCorp’s net profit for the nine months ended March 31, 2024 (9MFY2024) to RM594.03 million, versus a net loss of RM37.97 million in 9MFY2023. Revenue rose 7.09% to RM7.58 billion, from RM7.08 billion during the same period.

All in all, the company is “cautiously optimistic” that the remaining quarter of the financial year ending June 30, 2024 would be “satisfactory,” Berjaya added.

In terms of segment, food retail operations — largely driven by the Starbucks coffee franchise — reported a pre-tax loss as revenue fell amid consumer boycotts.

Starbucks, along with a few other global brands such as fast food chain McDonald’s, has been facing intense boycotts, due to their purported support of or perceived link to Israel, amid the ongoing conflict in Gaza.

In 3QFY2024, Berjaya’s non-food retail business, however, reported a higher pre-tax profit mainly as its luxury car unit HR Owen recorded better profit margin from new car sales and full resumption of its aftersales operations, following the completion of its outlets relocation.

Berjaya’s property segment reported higher revenue and pre-tax profit in 3QFY2024, mainly due to higher sales of overseas residence units.

Meanwhile, its services business also recorded higher revenue and pre-tax profit as its managed telecommunications network services and cloud and Internet of Things businesses reported higher project activities. The lottery business also saw higher sales per draw and additional draw.

Berjaya's hospitality segment posted lower profits, hurt by a rise in operating expenses even as revenue climbed on higher overall average room rates and occupancy rates due to a surge in tourist arrivals, boosted by visa exemption for certain countries.

Shares of Berjaya slipped half a sen or 1.7% to close at 29 sen on Friday, valuing the group at RM1.73 billion.