PETALING JAYA: IOI Properties Group Bhd’s net profit for its first quarter ending June 30, 2023 (Q1 FY2024) plunged 72.7% to RM174.44 million from RM640.29 million a year ago.

In its bourse filing today, the property group said the lower profits were due to weaker contributions from its property development segment domestically, and lower sales in China.

Quarterly revenue dipped 6.29% or RM43.5 million to RM648.05 million from RM691.5 million in the preceding year’s corresponding quarter.

“Though revenue in the property development segment declined by 15%, the contraction was partially offset by the performance in the property investment segment which improved by 31%,” it said.

Its property development arm recorded revenue and operating profit of RM451.4 million and RM101.3 million respectively, lower by RM78.5 million or 15%, and RM64.4 million or 39% than Q1 FY2023, respectively.

Meanwhile, its property investment segment recorded revenue and operating profit of RM144.3 million and RM71.6 million respectively, 31% and 47% higher respectively than Q1 FY2023.

“The surge in financial performance was supported by the commencement of IOI City Mall Phase 2 which has gradually elevated the occupancy rate to a higher level,” it said.

For the quarter, IOI Properties achieved sales of RM587 million, of which 98% or RM572.6 million were derived locally, whilst projects in China contributed the balance of RM14.4 million.

Sales were driven from the Johor region at RM400.5 million, led by agriculture land sales in Kulai, and townships in Bandar Putra Kulai and Taman Kempas Utama. Some RM1.13 billion worth of properties were launched during the period.

Looking ahead, it said the operating environment will continue to face some headwinds, both in and out of Malaysia.

Its range of product offerings, diversification across three countries, recurring earnings from property investment portfolios, and improving prospects of its hospitality and leisure segment, will drive sustained earnings ahead for the group.

At the close today, its shares were up 1 sen or 0.58% at RM1.73, giving it a market capitalisation of RM9.53 billion.