IGB's first quarter net profit more than doubles

KUALA LUMPUR: IGB Corp Bhd saw net profit for the first quarter ended March 31, 2017 more than double on higher contributions from the property investment and hotel divisions and a one-off gain of RM34.3 million from the disposal of property, plant and equipment by a subsidiary.

It made a net profit of RM115.25 million for the quarter, compared with RM51.8 million for the same quarter in the previous year.

This was despite revenue falling 9% to RM254.78 million for the quarter under review from RM280.20 million in the previous year on due to lower contributions from the property development, hotel and investment divisions.

IGB is currently awaiting approval for an amended planning permission from the London local council to develop a mixed development project there, with a gross development value (GDV) of £1.5 billion (RM8.37 billion).

The key feature of the mixed development project  located adjacent to the One Blackfriar development will be a 55-56 storey residential building erected on 2 acres of land.

The group's managing director Datuk Seri Robert Tan Chung Meng said the group is hopeful of obtaining an approval soon and expects the project to be wrap up in the following 36 months and begin contributing in mid 2019.

Locally, group's key focus lies on the Midvalley Megamall Southkey project in Johor Bahru for which it is targeting to obtain the certificate of completion and Compliance by the first quarter of next year. The mixed-use commercial development is expected to open its doors on August 18, 2018.

On the development of 18@Medini a mixed development project which were to be jointly undertaken by IGB and Distinctive Group on 18 acres of land in Medini, Iskandar Malaysia, Tan said no development has taken place on the land thus far.

 "Medini is still under keep in view. We use it as our stock," he said.

"It all depends on the market. The area is too overbuilt. We will keep it as a land bank. We will evaluate on the feasibility and viability later," Tan told reporters at a media briefing.

The group has allotted  a capital expenditure of RM15 million - RM20 million in the next two years to turn its low yielding spaces in Midvalley Megamall and Gardens to high yielding ones. A bulk of this capex will be channeled to the Midvalley Megamall.

Its Southpoint tower in MidValley City  is expected to see tenancy for its  office spaces by the end of the year while residential spaces is expected to filled up in the first half of next year.