KUALA LUMPUR: Malaysian Resources Corporation Bhd’s (MRCB) net profit for the financial year ended December 31, 2018 (FY18) decreased 37.5 per cent to RM101.17 million from RM161.91 million in FY17.
In a statement today, the company said the lower net profit recorded for FY18 was impacted by the absence of one-off disposal gains recognised in 2017, and construction work slowing down on the light rail transit (LRT) 3 Project being undertaken by 50 per cent-owned MRCB George Kent Sdn Bhd, while negotiations were on-going with the Government during its change from a project delivery partner (PDP) to a fixed-price turnkey contract.
It said the deferred income from the project will now resume in 2019, and continue until the project’s completion in 2024, following the contract agreement executed on January 25, 2019.
“A major challenge for us during 2018 was the re-modelling of the LRT3 Project, which impacted our performance considerably, resulting in profits being much lower than we budgeted.
“Now that the new contract has been signed, this deferred revenue will begin to flow again this year. The other key highlights were the signing of the concession termination agreement for the Eastern Dispersal Link Expressway and our disposal of an 80 per cent stake in Bukit Jalil Property Sdn Bhd, both of which marked the culmination of our Corporate Transformation and allowed us to pare down net debt to just 0.19 times,” MRCB group managing director Imran Salim said.
Its revenue in FY18 dropped 29.2 per cent to RM1.87 billion from RM2.64 billion.
On its prospects, MRCB in a filing to Bursa Malaysia said the group’s property segment had total cumulative unbilled sales that were expected to deliver RM1.6 billion in revenue to be booked over the development lifespan of its projects, about 87 per cent of which are residential and 13 per cent commercial.
“With interests in 114.12 hectares of urban land, the group has a sustainable stream of future projects with a total gross development value of RM31 billion,” it said.
As for the construction, engineering and environment division, it continues to actively tender for more contracting projects to replenish its order book.
MRCB said the division currently had open tenders valued at RM2.93 billion.