E&O on track to hit target

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EUGENE MAHALINGAM

Scenic: The shoreline slated for reclamation under Seri Tanjung Pinang Phase Two project. Chan says E&O is in final negotiations to award the reclamation contract to a potential partner

Scenic: The shoreline slated for reclamation under Seri Tanjung Pinang Phase Two project. Chan says E&O is in final negotiations to award the reclamation contract to a potential partner

KUALA LUMPUR: Eastern & Oriental (E&O) Bhd is optimistic of achieving its net profit target of RM173mil for its current financial year ending March 31, 2016, based on the number of ongoing projects the company has in its pipeline.

The company had set a cumulative net profit target of achieving RM450mil from 2014 to 2016, with the RM173mil being the “balance of target” to be achieved for this year, said deputy managing director Eric Chan.

“We have a programme in place. Yes, we’re operating in a challenging environment, but we’re working hard to roll out plans (to achieve the target),” he said at a press conference after the company AGM yesterday.

In a presentation, Chan said the company had line-up several launches in Penang, Kuala Lumpur and Johor to support the RM450mil cumulative net profit target.

“We have achieved 67% of that target for the first quarter of our current financial year,” he said.

E&O has unbilled sales of RM928mil as at August.

On the group’s Seri Tanjung Pinang Phase 2 project, Chan said the company was in final negotiations to award the reclamation contract to a potential partner.

“For the reclamation, we’ve shortlisted to the last two parties and expect to award the contract by the end of the year.”

Chan also said E&O expected to list its indirect unit in the London Stock Exchange (LSE) by the first quarter of next year.

He said the company was in the midst of obtaining the final approval necessary to list its unit.

“We have obtained shareholder approval to go ahead with the listing exercise. By year-end, all approvals should be obtained and we expect to list by the first quarter of 2016.”

E&O said in May that it proposed to admit the entire shares of E&O Property (UK) Ltd to trading on the Alternative Investment Market (AIM), the LSE’s international market for smaller growing companies.

The listing exercise is part of E&O’s plan to support its expansion into the United Kingdom.

For its first quarter ended June 30, E&O’s net profit rose 22.6% to RM23.3mil from RM18.96mil in the previous corresponding period, driven by the share of results of an associate, despite lower revenue.

Revenue fell 47% to RM68.89mil from RM129.74mil a year earlier. Its earnings per share rose to 1.90 sen for the quarter in review from 1.56 sen previously.

The decrease in revenue was due to lower revenue recognition, following the completion of two blocks of the Quayside Andaman Condominium in Seri Tanjung Pinang in the previous financial year.

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