Financials


Condensed Consolidated Statement Of Comprehensive Income
For The Financial Period Ended 31 December 2023

Comprehensive Income

Condensed Consolidated Statement Of Financial Position
As At 31 December 2023

Financial Position

Financial Review

Financial review for current quarter

Financial Position

Current quarter ("2Q 2024") against preceding year corresponding quarter ("2Q 2023")

For the 2Q 2024, the Group reported a revenue of RM296.999 million and loss before tax of RM33.414 million as compared to the revenue of RM294.499 million and profit before tax of RM17.403 million reported in the 2Q 2023.

The performance of the respective operating business segments for the 2Q 2024 under review as compared to the 2Q 2023 is analysed as follow:

Construction operations

The construction segment reported a higher revenue of RM184.929 million for the 2Q 2024 as compared to RM106.872 million in 2Q 2023. The revenue increased as compared to 2Q 2023 mainly due to our Setiawangsa-Pantai Expressway ("SPE") project is now in it's final stage of completion and has accrued the majority of the work done during the quarter. The stable progress of the RTS project also contributed to the revenue of the construction segment. With the increase in revenue, this segment's result has also improved from RM8.794 million in 2Q 2023 to RM30.370 million in 2Q 2024.

Property development

The property development segment reported a lower revenue of RM9.465 million for the current quarter as compared to RM47.457 million in the preceding year corresponding quarter. Similarly, the segment's result has declined from a profit of RM4.847 million in 2Q 2023 to a profit of RM2.674 million in 2Q 2024. This is primarily attributed to lower sales concluded from the balance of units in EkoCheras during the current quarter. With the limited sales units available, the company is preparing for the launching of EkoTitiwangsa to kick start our new property development.

Toll operations

The toll operations segment registered a lower revenue of RM59.702 million and a segment result of RM47.389 million profit in 2Q 2024 as compared with RM94.725 million revenue and a segment result of RM86.103 million profit in 2Q 2023.

The higher revenue in the corresponding quarter of the previous year was primarily due to the RM42.708 million compensation received from Kementerian Kerja Raya for the freezing of toll rate hikes for finanacial year 2020. If the toll compensation received in 2Q 2023 was excluded, the toll operations segment has shown an improvement of approximately 14.77% in revenue from RM52.017 million in the 2Q 2023 to RM59.702 million in the 2Q 2024. The higher revenue in the current quarter was due to increase in toll collections from the opening of the new SPE Highway on 3 November 2023.

Plantation

For the current quarter 2Q 2024, the plantation segment registered a lower revenue of RM30.286 million and a segment result of a profit of RM7.204 million as compared with revenue of RM33.651 million and segment result of a profit of RM7.894 million in the preceding year corresponding quarter. The decrease in revenue and earnings were mainly attributed to the lower sales contribution from the oil palm plantation, weaker commodity price for crude palm oil, decline in yield of oil palm estates and comparatively weaker margin for offtake of downstream durian products.

Food and Beverages

The F&B division has registered a lower revenue of RM2.650 million for 2Q 2024 as against the preceding year corresponding quarter of RM3.658 million. The decline in revenue was mainly attributed to the restructuring of the F&B outlets within the Group, where certain outlets were closed to pave the way forward to a new approach in franchising and licencing. The higher loss of RM1.561 million in 2Q 2024 as compared to a loss of RM0.038 million in 2Q 2023 was also contributed by the higher operating and staff costs incurred for the opening of the new restaurant, DUKE's Kitchen in INNSiDE by MeliĆ” Hotel in EkoCheras.

Property Investment and others

The property investment segment's revenue for the current quarter in comparison to the corresponding quarter of the preceding year has improved from RM8.136 million in 2Q 2023 to RM9.967 million in 2Q 2024. The increase in the revenue is mainly due to the newly opened INNSiDE by MeliĆ” Hotel in EkoCheras in March 2023 and no further rebates were given to the tenants of EkoCheras Mall as compared to the preceding corresponding quarter.

Financial review for financial year to date

Financial Position

Current year to date ("YTD 2024") against preceding year corresponding period ("YTD 2023")

For the YTD 2024, the Group registered a revenue of RM 568.897 million and loss before tax of RM 10.406 million as compared to the revenue of RM617.397 million and profit before tax of RM24.300 million reported in YTD 2023. The loss for the YTD 2024 as compared to YTD 2023 is mainly due to the financing costs for SPE Highway no longer be capitalized in the financial statements since the full opening of SPE. The performance of the respective operating business segments for the YTD 2024 under review as compared to the YTD 2023 is analysed as follows :

Construction operations

The construction sector reported a higher revenue of RM350.188 million for the YTD 2024 as compared to RM263.804 million in YTD 2023. The revenue increased as compared to YTD 2023 as our Rapid Transit System Link ("RTS Link") projects are progressing steadily. The segment results has improved from RM21.988 million in 2023 to RM 75.977 million in YTD 2024 mainly due to our Setiawangsa-Pantai Expressway ("SPE") project which is nearing completion, there are some savings on the construction cost upon the gradual finalisation of the sub-contractors' final account and certifications.

Property development

The property development segment for the YTD 2024 reported a lower revenue of RM15.354 million as compared to preceding year corresponding period of RM113.841 million. Similarly, the segment's result has declined from a profit of RM15.592 million in YTD 2023 to a profit of RM2.520 million in YTD 2024. This decline is primarily attributed to lower sales concluded during the current reporting period due to limited units available as compared to the previous year wherein September 2022 the Company has just obtained the Bumi Release for EkoCheras units therefore more units are available for sales.

Toll operations

The toll operations sector registered a lower revenue of RM116.192 million in YTD 2024 as compared to RM145.707 million in YTD 2023 and reported a lower profit of RM93.458 million in YTD 2024 as against RM128.975 million in YTD 2023. The revenue recorded in YTD 2023 includes the toll compensation for calendar year 2020 amounting to RM42.708 million. Excluding the toll compensation, there is an increase approximately 12.81% in the toll collection receipts for YTD 2024 as compared to YTD 2023 due to the increase in toll collections from the opening of the new SPE Highway on 3 November 2023.

Plantation

The plantation sector registered a lower revenue of RM62.025 million and a segment results of RM13.647 million in YTD 2024 as compared with the revenue of RM71.403 million and a segment results of RM19.142 million in YTD 2023.

The decrease in revenue was mainly attributed to the lower sales contribution from the oil palm plantation and lower Fresh Fruit Bunches (FFB) average selling price. Meanwhile, other divisions' sales such as the durian manufacturing and trading division were also having a lower sales volume for their durian products to overseas customers in China.

Food and Beverages

The F&B division has registed a lower revenue of RM5.294 million for YTD 2024 as against the preceeding corresponding year of RM7.056 million.

The decrease in revenue primarily stemmed from the recent closure of numerous outlets by the Group, aligning with our new strategic vision for our F&B Group in franchising and licensing to enhance our market presence, maximize opportunities, and broaden our potential within the industry.

Property Investment and others

The property investment segment's revenue has increased from RM15.586 million in YTD 2023 to RM19.844 million in YTD 2024. This is mainly driven by a higher occupancy rate at EkoCheras Shopping Mall as compared to the previous year. Additionally, our newly opened INNSIDE by Melia Hotel in EkoCheras has also contributed to our segment revenue and gross profit.

Prospects

The Board remains optimistic in delivering positive financial results and is confident each of the Group's segments would contribute positively to the Group's performance for the new financial year ending 30 June 2024.

The Group had also experienced steady increase in toll revenue for Duke Phase-1 and Phase-2 upon the upliftment of the MCO since October 2021, and with the full opening of the SPE on 3 November 2023 will further improve the toll collection revenue under this operating segment, notwithstanding that financing costs for SPE will no longer be capitalised in the financial statements once the full opening of SPE.

The Board will continue to explore the right opportunities which will contribute to both the property development and construction segment simultaneously. The Group has finalised the financial requirement and the authorities' submission, and planned to launch the upcoming new property development, EkoTitiwangsa by the next quarter. As for the construction segment, the Board expects that the on-going rationalisation of the construction scope under the RTS Link project will contribute positively to the Group's future construction revenue and earnings. In addition, the Group is continuously working closely with Government on various infrastructure projects.

Our subsidiary, PLS Plantations Berhad ("PLS"), is in a transition phase from its core business in traditional oil palm plantation to the broader agrofood industry. PLS's transformation journey from the cyclical oil palm plantation to a more diversified range of upstream and downstream activities will require a longer gestation period. In particular, the gestation period for the durian trees is about 4 to 5 years and thus, the bulk of our durian revenues are now mainly from trading activities. In the near term, PLS will continue its current rehabilitation and sanitation works with emphasis on recommended plantation practices to improve the production yield of its oil palm estates, matured durian plantation and contract farm. In addition, PLS will continue to work closely with its current and prospective business associates to improve the retail offtake rate of downstream durian products by offshore wholesalers and end consumers. Concurrently, upstream investment in durian plantation will continue to be a mainstay of PLS to complement its existing downstream business while waiting for PLS's durian farm to be matured and fruitful in 3 to 4 years.

This is in line with the long-term group strategy to expand and diversified into other businesses to reduce dependency and reliance on our existing businesses in construction and property development.