KUALA LUMPUR (May 13): GuocoLand (Malaysia) Bhd (KL:GUOCO) — controlled by tycoon Tan Sri Quek Leng Chan — saw its net profit tumble 66.3% for the third quarter ended March 31, 2024 (3QFY2024), due to lower revenue from its property development division.

Nonetheless, this was partially offset by a better performance of the hospitality division, thanks to higher occupancy and better average room rates.

In a filing with Bursa Malaysia on Monday, GuocoLand posted a net profit of RM2.94 million for the quarter under review, from RM8.71 million a year earlier, on the back of a 20.8% decline in revenue to RM88.97 million from RM112.36 million.

Looking ahead, Guocoland flagged that the domestic property sector will remain challenging, because of elevated interest rates and rising construction costs.

“Property sales remain challenging, due to an oversupply of properties in different markets and segments. New product launches will be phased, in line with the prevailing market conditions,” it said in a bourse filing on Monday.

Having said that, the group said it will focus on the timely completion of its ongoing development projects, and monetisation of its inventories, while seeking opportunities to expand its land bank.

Cumulatively, for the nine-month financial period ended on March 31, 2024 (9MFY2024), the group’s net profit declined by 30.8% to RM13.02 million from RM18.81 million a year earlier, despite revenue climbing 10.7% to RM327.73 million from RM296.07 million, due to lower profit margins and higher construction costs.

Last Friday, Paramount Corp Bhd (KL:PARAMON) bought a 21.54% stake in Eco World International Bhd (KL:EWINT) for RM170.61 million or 33 sen a share from GLL EWI (HK) Ltd — a unit of GuocoLand Ltd controlled by Quek — via a direct business transaction. It sold the remaining 5.46% stake in EWI to an unknown buyer.

At Monday’s market close, shares in Guocoland were up 1.5 sen or 2% to 76.5 sen each, valuing the group at RM535.85 million.