Financials
Condensed Consolidated Statement Of Comprehensive Income
For The Financial Period Ended 30 June 2024
Condensed Consolidated Statement Of Financial Position
As At 30 June 2024
Financial Review
Financial review for current quarter
Current quarter ("4Q 2024") against preceding year corresponding quarter ("4Q 2023")
For the 4Q 2024, the Group reported a revenue of RM270.450 million and loss before tax of RM54.220 million as compared to the revenue of RM279.333 million and loss before tax of RM65.769 million reported in the 4Q 2023.
The performance of the respective operating business segments for the 4Q 2024 under review as compared to the 4Q 2023 is analysed as follow:
Construction operations
The construction segment reported a lower revenue of RM150.276 million for the 4Q 2024 as compared to RM184.255 million in 4Q 2023. The revenue has declined compared to 4Q 2023 mainly attributable to the completion of the Setiawangsa-Pantai Expressway ("SPE"), which resulted in a lower revenue contributions for this segment. However, the segment result has improved from RM21.015 million in 4Q 2023 to RM54.299 million in 4Q 2024 primarily driven from the savings on the construction cost upon the finalisation of the sub-contractors' final account and certifications on the SPE project.
Property development
The property development segment reported a revenue of RM10.371 million and a segment result of RM1.013 million profit for the current quarter as compared with revenue of RM9.978 million and a segment loss of RM2.701 million in the preceding year corresponding quarter. Our property development segment has consistently demonstrated stable performance. The losses reported in 4Q 2023 were mainly due to the under provision of sales and marketing expenses incurred from the earlier quarters of the preceding year.
Toll operations
The toll operations segment registered a higher revenue of RM69.774 million in 4Q 2024 as compared to RM52.663 million in 4Q 2023, marking approximately 32.50% increase in revenue. The higher revenue in this current reporting quarter was due to the increase in toll collections from the opening of the new SPE Highway on 3 November 2023. As a result of the increased revenue, this segment reported a higher profit of RM60.441 million in 4Q 2024 as against RM55.482 million in 4Q 2023.
Plantation
For the current quarter 4Q 2024, the plantation segment registered a revenue of RM26.614 million and a segment loss of RM4.473 million as compared with revenue of RM21.825 million and a segment loss of RM40.381 million in the preceding year corresponding quarter. The increase in the segment's revenue were mainly attributed to higher Fresh Fruit Bunches ("FFB") average prices and higher production volumes together with sales contribution from forestry activities. The segment's losses for the current year quarter was much lower following the absence of a lower impairment losses on goodwill and trade receivables in comparison to the preceding year correspondence quarter.
Food and Beverages
The F&B division has registered a lower revenue of RM0.578 million for 4Q 2024 as against the RM2.715 million in 4Q 2023. The decline in revenue was mainly due to the scaling down of the F&B segment, where a total of 8 outlets were closed during the year to pave the way forward to a new approach in franchising and licencing. The reduction in operating costs and the termination of the lease liability have mitigated the losses, bringing down from RM1.027 million in Q4 2023 to RM0.391 million in Q4 2024.
Property Investment and others
The property investment segment's revenue for the current quarter has improved from RM7.897 million in 4Q 2023 to RM12.837 million in 4Q 2024. The growth is mainly driven by the increase revenue from the hotel operations of INNSiDE by Meliá Hotel in EkoCheras and the reduction of rebates given to the tenants of EkoCheras Mall as compared to the preceding corresponding quarter.
Financial review for financial year to date
Current year to date ("YTD 2024") against preceding year corresponding period ("YTD 2023")
For the YTD 2024, the Group recorded a revenue of RM1,145.809 million and a loss before tax of RM50.392 million as compared to the revenue of RM1,116.909 million and a loss before tax of RM9.855 million reported in YTD 2023.
The higher loss before tax for YTD 2024 as compared to YTD 2023 is attributable to several factors. Firstly, the financing costs for SPE Highway can no longer be capitalized in the financial statements since the full opening of SPE in November 2023 where the Group expects the traffic number to ramp up. Consequently, the Group's financing costs reflected in the Income Statement have risen from RM246.570 million in YTD 2023 to RM380.831 million in the current year to date.
Secondly, the Group has yet to receive the disbursement of toll compensation for year 2023 toll rate hike deferral estimated at RM64.0 million for Duke 1 & 2. Furthermore, the Group has not been able to recognize the scheduled toll rate for Duke 1 & 2, which was due on 1 January 2024.
As for SPE highway, the Group is expecting some compensation from the government arising from the delays in project completion following changes in alignment and due to interfacing issues with other Government projects on site.
The above factors have significantly impacted the Group's financial results for the current year to date.
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
For YTD 2024, the construction sector reported a higher revenue of RM638.873 million, up from RM526.988 million in YTD 2023. This increase is attributed to the progress of our Rapid Transit System Link ("RTS Link") project. Additionally, with the completion of our SPE project, the realisation of savings on the construction cost upon the finalisation of the sub-contractors' final account and certifications have also improved the segment results from RM91.114 million in YTD 2023 to RM150.917 million in YTD 2024.
Property development
The property development segment for the YTD 2024 reported a lower revenue of RM30.132 million as compared to preceding year of RM139.090 million. Correspondingly, the segment's result has also declined from a profit of RM12.082 million in YTD 2023 to a profit of RM4.134 million in YTD 2024. The lower segment results is primarily attributed to lower sales concluded during the current reporting year due to limited units available as compared to the YTD 2023 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 slightly higher revenue of RM310.839 million in YTD 2024 as compared to RM287.728 million in YTD 2023 and reported a lower profit of RM265.849 million in YTD 2024 as against RM270.027 million in YTD 2023. The revenue recorded in YTD 2023 includes the toll compensation for calendar year 2020 and year 2021 amounting to RM79.456 million, as compared to YTD 2024 which recorded the toll compensation for calendar year 2022 of RM57.553 million, the lower compensation amount recorded in YTD 2024 appeared to have relatively lower gross profits. By excluding the toll compensation, there is an increase approximately 21.61% 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 RM114.888 million and a segment results of RM7.576 million profit in YTD 2024 as compared with the revenue of RM118.280 million and a segment loss of RM19.546 million in YTD 2023. The decrease in revenue was mainly attributed to the decline in crude palm oil price. Meanwhile, other divisions' sales such as the durian manufacturing and trading division were also experienced lower sales volumes for their durian products. The losses incurred in YTD 2023 were mainly attributable to the recognition of the substantial impairments losses on goodwill and trade receivables.
Food and Beverages
The F&B division has registered a lower revenue of RM7.578 million for YTD 2024 as against the preceding corresponding year of RM12.655 million. The decrease in revenue primarily stemmed from the recent closure of numerous outlets by the Group throughout the year, including two in Langkawi and six located in various shopping malls. These closures are aligned with our new strategic vision to scale down the operation for our F&B segment.
Property Investment and others
The property investment segment's revenue has increased from RM32.168 million in YTD 2023 to RM43.499 million in YTD 2024. This is mainly driven by a higher tenancy rate at EkoCheras Shopping Mall as compared to the previous year. Additionally, our hotel's operation of INNSIDE by Melia Hotel in EkoCheras has also contributed to our segment revenue and gross profit.
Prospects
The Board remains optimistic about the future development of each of the Group's business segments and is confident that each segment will contribute positively to the Group's performance in the coming financial year ending 30 June 2025.
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. This 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.
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 November 2024. As for the construction segment, the Board expects that the on-going rationalisation of the construction scope under the RTS Link project as well as construction of EkoTitiwangsa to 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") 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 and margin 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.