Sunway posts net profit of RM78.29 million for first quarter

27 May 2020 / 22:37 H.

PETALING JAYA: Sunway Bhd posted a net profit of RM78.29 million for the first quarter ended March 31, 42.6% lower than the RM136.41 million in the previous corresponding quarter due to lower contributions from most business segments except property development and quarrying.

Revenue was lower at RM971.44 million, from RM1.12 billion previously.

In a statement, the group said the movement control order (MCO) and the subsequent conditional MCO caused significant disruptions and financial impact to the group, particularly the hospitality and leisure businesses, which were not allowed to operate during these periods.

“Although most of the other businesses of the Group have resumed operations during the conditional MCO, the anticipated business recovery will be challenging and dependent on the overall improvement of the broader economy,” it noted.

That said, Sunway said it has activated its business continuity plan which incorporated its digital platform to manage the operational disruptions caused by the pandemic and the imposition of the MCO. In addition, the group has implemented several cost-saving measures including recruitment freeze.

In a separate Bursa filing, the group proposed to undertake a renounceable rights issue of up to 1.11 billion new irredeemable convertible preference shares (ICPS) on a basis of one ICPS for every five existing ordinary shares in Sunway at an issue price of RM1.

The expected gross proceeds raised from the rights issue would be RM980.3 million under the minimum scenario, and RM1.11 billion under the maximum scenario. The bulk of the proceeds will go towards repayment of borrowiings, with the rest put towards capital expenditure and property development.

The exercise is expected to be completed by the fourth quarter of the year.

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