KUALA LUMPUR (Aug 27): Sunway Bhd (KL:SUNWAY) has reported a modest 0.9% increase in net profit to RM272.95 million for the second quarter ended June 30, 2025 (2QFY2025), despite a sharp rise in revenue.

The subdued earnings growth was attributed to higher operating expenses which grew 61% in tandem with the increase in revenue, a 26% decline in other operating income and a 27% drop in contributions from associates and joint ventures.

However, the group also benefited from an 80% reduction in impairments to RM3.07 million and a 76.4% decline in net finance expense to RM2.27 million, according to a bourse filing on Wednesday.

Quarterly revenue jumped 62.1% to RM2.56 billion from RM1.58 billion in 2QFY2024, driven by an improved performance mainly from the construction segment.

The conglomerate declared an interim dividend of four sen per share, doubling from two sen a year earlier.

For the first half of FY2025, Sunway’s net profit rose 4.7% to RM463.51 million from RM442.7 million in the previous corresponding period, while revenue surged 64.4% to RM4.928 billion from RM2.998 billion.

Segmentally, the property development division posted a revenue of RM351.4 million and profit before tax (PBT) of RM52.2 million, down from RM371.9 million and RM70.1 million respectively in the same quarter last year. The softer performance was due to lower progress billings from newer projects, which dampened profit recognition across both local and international developments, said Sunway.

During the quarter, the group launched Sunway Flora 2 and retail units at Jernih Residence in the Klang Valley, followed in July by Otto Place, an executive condominium in Singapore that achieved a strong 91% take-up rate.

Meanwhile, the construction segment delivered standout results, with revenue surging 232.8% to RM1.268 billion and PBT climbing 157% to RM134.8 million, driven by accelerated progress on several data centre projects.

Year to date, the segment has secured RM3.8 billion in new orders, contributing to a robust outstanding order book of RM6.7 billion as of June.

In healthcare, Sunway continued expanding its footprint, increasing its total licensed bed capacity to 1,662. The segment recorded a PBT of RM35.5 million, down from RM49.3 million a year earlier, due to start-up losses from the newly launched Sunway Medical Centre Damansara and Sunway Medical Centre Ipoh. Excluding these two hospitals, the segment posted a 17.2% increase in PBT to RM57.8 million.

Commenting on the results, Sunway group president Tan Sri Chew Chee Kin said the group remains confident in its resilience and proven execution capabilities, despite ongoing macroeconomic headwinds and fiscal reforms that continue to shape the operating landscape. He said Sunway will stay focused on its strategic priorities while navigating these challenges.

He added that the group expects its performance to remain strong, underpinned by continued progress across its core businesses throughout the year.

Sunway shares were up 17 sen or 3.5% at RM4.97 at Wednesday’s close, valuing the conglomerate at RM31.16 billion. The stock has gained 3.8% year to date.