KUALA LUMPUR: EcoWorld International Bhd sales jump 68% to RM685mil in the first four months of financial year ending Oct 31, 2022 (FY22) from a year ago.
The property developer said both Embassy Gardens and London City Island projects were the biggest contributors to sales, generating RM240mil and RM229mil sales, respectively, based on contracts exchanged.
President and chief executive officer Datuk Teow Leong Seng said the higher sales was driven by attractive incentive packages offered to customers, which led to a resurgence in buying interest, especially for its London City Island and Embassy Gardens projects.
“Local demand in Australia has also been recovering steadily, which contributed to the RM685mil sales secured in the first four months of this financial year,” he said in a statement.
The group also has a strong reservation pipeline of RM393mil.
As at Feb 28, the total sales including reserves added up to RM1.07bil.
Although the near-term market outlook remains challenging amid the Russia-Ukraine war, Teow said the impact of an inflationary environment could favour the group as its selling prices stand to benefit from rising property prices.
“Our costs on the completed and near-completed projects are largely shielded from inflationary pressure.
“We do, however, acknowledge the uncertain market environment caused by rising geopolitical tensions – against such a backdrop, the strategic decision we made at the end of 2021 to accelerate cash recoupment via the sale of our completed units remains very sound,” he added.
Moving forward, Teow said EcoWorld International continues to see good interest from both institutional and retail investors for its projects in Australia and the United Kingdom.
“This includes several large offers which we are currently assessing. Should we decide to proceed with these offers, our plans to repatriate the capital that we have invested in our completed projects could be accelerated,” he added.
Apart from this, Teow said the board intends to sell the remaining units in the EcoWorld-Ballymore and Australian projects in the next two to three years with a key goal of making further distributions to shareholders, after setting aside a portion of the capital recouped from these completed projects to be reinvested for future growth.
On the group’s other UK joint venture, EcoWorld London had obtained the planning permission for its Woking site located in Surrey, which has an estimated gross development value of around ￡350mil (RM1.92bil).
The management aims to finalise the development programme and launch the project by late this year if market conditions are conducive.
The launch of Woking will mark the group’s maiden expansion beyond the city of London.
EcoWorld London is also working towards obtaining the planning permission for Oxbow Phase 4, which is targeted to be launched around the same time as Woking.
The group recorded a pre-tax loss of RM12.74mil in the first quarter ended Jan 31 due to fewer handovers of properties sold to customers in the current quarter.
This is as compared to a profit of RM77.47mil in the first quarter of 2021 based on the completion method of accounting adopted in both Australia and the UK, following the substantial handovers of units sold to customers at the start of the last financial year.