E&O returns to the black in 2Q

KUALA LUMPUR (Nov 22): Property developer Eastern & Oriental Bhd (E&O) returned to the black in the second financial quarter ended Sept 30, 2022 (2QFY2023), posting a small net profit of RM16,000 compared to a net loss of RM13.99 million a year earlier, on higher revenue recognition from its property and hospitality segments, lower finance cost, and higher share of results of joint ventures.

However, the improved performance was offset by higher foreign exchange loss of RM42.7 million for 2QFY2023, compared with RM10.3 million a year earlier.

Revenue for the quarter under review grew 180.5% to RM95.02 million from RM33.88 million for 2QFY2022, mainly attributed to contributions from the property and hospitality segments.

The better quarterly performance managed to narrow the group's net loss for the cumulative six-month period (1HFY2023) to RM1.63 million from RM23.09 million a year earlier, while revenue increased 184% to RM171.57 million for 1HFY2023 from RM60.41 million previously.

On prospects, E&O said the high take-up rate achieved of more than 80% for its Meg high-rise residential development since the preview in January increases its conviction to launch more projects in Penang in the near future.

"[Additionally,] E&O’s hospitality segment continues to enjoy increasing occupancy rates and average room rates in light of the robust tourism sector in Malaysia and the UK," it added.

E&O shares were untraded in the morning session. The counter closed at 40.5 sen on Monday (Nov 21), bringing it a market capitalisation of RM590.79 million.