KUALA LUMPUR (June 20): Eco World Development Group Bhd (KL:ECOWLD) reported an 11.7% increase in net profit to RM70 million for the second quarter ended April 30, 2024 (2QFY2024), up from RM62.7 million a year ago, driven by higher revenue and cost savings in completed and near-completion development projects.

Earnings per share rose to 2.38 sen from 2.13 sen, according to EcoWorld in a bourse filing. The property developer declared an interim dividend of two sen per share, payable on July 19.

Revenue for the quarter increased by 32.1% to RM555.76 million, from RM420.82 million for the previous corresponding period, due to higher contributions from active and newly launched phases of projects.

For the first half ended April 30, 2024 (1HFY2024), cumulative net profit rose 16.7% to RM139.68 million from RM119.69 million for the same period last year, while revenue increased by 20.8% to RM1.1 billion from RM905.56 million.

The group achieved RM2.18 billion in sales in the first seven months ended May 31, 2024, representing 62% of its FY2024 sales target.

The strong sales performance was driven by strong demand in Iskandar Malaysia, which recorded RM1.33 billion in sales, accounting for 61% of total sales.

On its prospects, EcoWorld president and chief executive officer Datuk Chang Khim Wah said that the group is capitalising on strong industrial market demand, especially in the southern region of Peninsular Malaysia, with RM420 million in sales under the Eco Business Parks (EBP) pillar by May 31.

Additionally, EcoWorld entered into an agreement on June 7 to sell 123.14 acres (49.83 hectares) of industrial land to Microsoft Payments (Malaysia) Sdn Bhd for RM402.3 million in EBP VI, Kulai, Iskandar Malaysia. Chang said this sale underscores the success of the group's strategy to cater to a wide range of customers and investors.

He added that as the group's projects mature, strong sales had boosted cash generation, with RM470 million from operating activities in 1HFY2024, tripling its profit after tax.

"As a result, our cash balances (including deposits and short-term funds) have reached the highest level to date at RM1.44 billion, reducing our net gearing ratio to 0.24 times," Chang said, noting that this financial strength allows the group to acquire more land bank.

Shares in EcoWorld remained unchanged at RM1.58 during the noon break on Thursday, valuing the company at RM4.65 billion.