KUALA LUMPUR (Sept 19): Eco World Development Group Bhd (KL:ECOWLD) reported a 21.26% year-on-year increase in its third quarter net profit, driven by improved earnings contributions from its Malaysian operations.

Its net profit for the three months ended July 31, 2024 (3QFY2024) rose to RM80.44 million from RM66.34 million in 3QFY2024, as revenue grew 10.35% to RM526.22 million from RM476.85 million, supported by higher contributions from active phases and newly launched developments.

The group's gross profit margin improved to 31.3% from 27.2%, largely due to the realisation of cost savings from certain completed and near-completion phases.

Earnings per share increased to 2.73 sen from 2.25 sen previously.

EcoWorld declared a second interim dividend of two sen per share, payable on Oct 23. This brings its dividend payout for the first nine months of FY2024 to four sen per share, matching the amount paid in the same period in FY2023.

The property developer’s filing showed that profit after tax from its Malaysian operations rose 21.13% to RM81.45 million in the quarter under review, which offset a higher share of losses from its international arm, EcoWorld International Bhd, primarily due to a lower accounting fair value adjustment realised during the period.

The main projects contributing to EcoWorld's earnings in 3QFY2024 were Eco Botanic, Eco Botanic 2, Eco Spring, Eco Tropics, Eco Business Park I, Eco Business Park II, and Eco Business Park III in Iskandar Malaysia, as well as Eco Majestic, Eco Forest, and Eco Sanctuary in the Klang Valley.

EcoWorld’s cumulative net profit for 9MFY2024 rose 18.32% to RM220.12 million, up from RM186.03 million in the previous year, as cumulative revenue grew 17.17% to RM1.62 billion from RM1.38 billion.

In a statement, the group’s president and CEO Datuk Chang Khim Wah said the group's sales for the first 10 months of FY2024 from November 2023 to August 2024 stood at RM3.503 billion, surpassing its full-year target of RM3.5 billion.

Its projects Iskandar Malaysia were the largest contributor, accounting for 63% of the group’s total sales, followed by 27% from the Klang Valley and 10% from Penang.

Meanwhile, the group said its financial position has continued to strengthen, with RM657.6 million cash generated from operating activities in 9MFY2024, surpassing FY2023's cash generated of RM572.2 million.

“Our cash balances stand at RM1.55 billion as at July 31, 2024, which is an all-time high for EcoWorld Malaysia, enabling a further reduction of our net gearing ratio to 0.21 times. This puts us in a highly favourable position to acquire more landbank,” said Chang.

“On this note we are actively working on several potential land bank acquisitions to broaden and deepen EcoWorld Malaysia’s market share, which will pave the way for robust and sustainable growth in the future,” Chang added.

Shares of EcoWorld closed up three sen or 1.75% at RM1.74 on Thursday, giving the group a market capitalisation of RM5.13 billion.