Image source: paramountproperty.my

Paramount Corp Bhd doubled their profit from RM15.62 million a year-ago quarter to RM30.30 million in end-Sept 2019, following a gain on disposal.

In an exchange filing on 20th November, Paramount attributed its strong profitability of RM23.3 million to the disposal of their controlling stake in KDU University College Sdn Bhd, KDU College (PG) Sdn Bhd, and KDU College (PJ) Sdn Bhd, to the newly completed on 3rd September University of Wollongong.

Their revenue in the third quarter of 2019 recorded a 3% increment from the third quarter of 2018, at a total of RM217.09 million as compared to RM210.53 million the previous year. The contribution was attributed mainly to the property division.

Paramount marked the property contribution to the revenue derived from its Utropolis Glenmarie, Berkeley Uptown, and Greenwoods developments. The profit before tax, however, decreased by 49%, with losses noted from the Utropolis Glenmarie and Atwater developments, followed by higher losses from Utropolis Marketplace.

Paramount’s net profit stands at RM64.93 million within the cumulative 9 months period, comparable to the RM64.88 million of the corresponding period within the previous year. In the meantime, revenue grew by 7% from RM695.97 million to RM651.15 million.

According to Paramount Group Chief Executive Officer Jeffrey Chew in a statement, the Group achieved property sales of RM481 million in the first 9 months of 2019, on top of the RM714 million worth of properties launched. “The group’s total unbilled sales of RM957 million as of Sept 30, 2019 is expected to contribute positively to our financial performance in the foreseeable future.”

Chew expects the property market to remain soft in the fourth quarter of 2019, but also expects property buyer sentiments to improve following the extension of the Home Ownership Campaign (HOC) to 31st December 2019, and Bank Negara’s move to reduce the Overnight Policy Rate (OPR).

He further added, "The proposed divestment of the controlling stake in our K-12 education business will pave the way for Paramount to focus on property development, explore new business opportunities while retaining an effective 20% stake in the business. The transaction is expected to be completed in 4QFY19.”

Chew expects the Group’s financial performance to be comparable to the previous year, excluding the gains obtained from the disposal of the pre-tertiary business.

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(21 November 2019)