BUSINESS
Malaysia's IOI Properties Group Bhd today reported a 70% on-quarter drop in January-March net profit as new government price-controlling measures hurt domestic sales.
The country's second-largest real estate developer by market value – reporting earnings for the second time since its January 15 listing – said profit for its fiscal third quarter reached RM89.11 million (US$27.74 million).
During the quarter, measures such as an increase in property gains tax came into effect, as the authorities work to slow the rise of property prices and fend off what is widely feared to be the onset of a property bubble.
"The outlook for the property market in both Malaysia and Singapore remains challenging especially in the high-end segment," IOI Properties said in a statement.
"The mass-market segment in Malaysia, where the group has significant presence, will remain the key revenue driver."
IOI, controlled by Lee Shin Cheng – Malaysia's sixth-richest man, according to Forbes – has properties in Malaysia and neighbouring Singapore, as well as in China.
Shares of IOI Properties ended morning trade 0.4% higher at RM2.61 before the earnings release, compared with a 0.2% decline in the FTSE Bursa Malaysia KLCI Index .
The stock has fallen 17% since listing, versus a 2.7% gain in the benchmark. – Reuters, May 23, 2014.
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