GuocoLand (Malaysia) Berhad Reports Robust Q1 FY2026 Results: Revenue and Profit Surge on Property and Plantation Strength

Key Highlights of Q1 FY2026 Results (For the Quarter Ended 30 September 2025)

• Revenue: RM122.7 million, up 77% from RM69.4 million in Q1 FY2025.
• Profit Before Tax: RM11.7 million, up 58% from RM7.4 million a year ago.
• Net Profit: RM8.5 million, up 87% from RM4.5 million last year.
• Profit Attributable to Shareholders: RM6.1 million, more than double the RM2.9 million previously.
• Basic Earnings Per Share: 0.91 sen (Q1 FY2025: 0.43 sen).
• No Dividend Declared: No interim dividend for the quarter.
• Net Assets Per Share: RM2.0935 (up from RM2.0844 at previous year-end).

Operational and Business Segment Insights

• Property Development Division:
  • Main driver of revenue and profit growth, led by robust sales and progressive billings from the Emerald 9 project in Cheras.
  • Continued strong momentum in property sales expected to support future quarters.
• Plantation Division:
  • Significant improvement due to higher crude palm oil (CPO) prices.
• Hotel Division:
  • Improved performance on the back of a 13% increase in average room rates.
• Finance Costs:
  • Lower finance costs (RM6.2m vs RM8.4m last year) contributed positively, reflecting reduction in borrowings.

Financial Position and Cash Flow

• Total Assets: RM2.71 billion (up from RM2.67 billion at June 2025).
• Equity Attributable to Shareholders: RM1.40 billion.
• Cash and Cash Equivalents: RM137 million (down slightly from RM143 million at year-end).
• Borrowings: Total borrowings stand at RM551 million (short-term RM79.5m, long-term RM472m).
• Net Cash Used in Operating Activities: RM12.6 million outflow (Q1 FY2025: RM2.8 million inflow), primarily due to movements in working capital including higher receivables and contract assets.
• Net Cash Used in Investing Activities: RM0.4 million outflow (Q1 FY2025: RM9.5 million inflow due to JV dividends last year).
• Net Cash from Financing Activities: RM7.3 million inflow (bank borrowings drawdown offset by repayments and dividends to non-controlling interests).

Important Updates for Shareholders

• Legal Matter:
  • Arbitration award: Subsidiary GLM Emerald Hills (Cheras) Sdn Bhd was ordered to pay RM6.36 million plus 5% interest per annum and costs to a contractor following a contract dispute. The company is challenging the award in the High Court. This is material and may impact future earnings/liquidity if the court challenge fails.
• Reclassification of Tower REIT:
  • Following a substantial subscription in May 2024, GuocoLand’s stake in Tower REIT rose to 33.32%, resulting in full consolidation of the REIT from an associate to a subsidiary. This restatement has significantly increased assets, liabilities, and non-controlling interests in comparative figures.
• No Interim Dividend:
  • No dividend declared for the quarter; last year, no interim dividend was declared for the same period as well.
• ESS Trust Shares:
  • 30,544,067 shares are held by the Executive Share Scheme (ESS) Trust. No new shares were purchased by the Trust in the period. This may affect free float and liquidity in the market.
• Borrowing and Gearing:
  • Despite slightly higher borrowings, the Group continues to focus on financial prudence and maintaining a healthy gearing ratio.
• Taxation:
  • Effective tax rate higher than statutory rate due to non-deductible expenses and unutilised subsidiary losses.

Outlook and Strategy

• The Group expects to maintain performance for FY2026, barring unforeseen circumstances.
• Focus remains on timely delivery of ongoing projects, continued sales of completed inventories, and prudent cash flow management.
• Ongoing initiatives for cost management, value engineering, and process improvements to counter rising construction and development costs.
• The Group is also exploring selective developments from its land bank and plans to diversify into industrial development to capture long-term growth prospects.
• Property market outlook is stabilizing, supported by economic reforms, easing monetary policy, and infrastructure programs.

Potential Price-Sensitive Issues

• Arbitration Award: The outcome of the legal challenge against the RM6.36 million arbitration award could materially impact earnings and cash flow.
• Strong Earnings Growth: Significant improvement in revenue and profit, especially from the Emerald 9 project, may positively influence investor sentiment and share price.
• Restatement of Financials: The consolidation of Tower REIT and associated restatements have meaningfully altered the asset base and equity structure, impacting key financial ratios and performance comparatives.
• No Dividend: The continued absence of a dividend may be disappointing to income-focused investors.

Conclusion

GuocoLand (Malaysia) Berhad has delivered a strong start to FY2026, driven by robust property development activities and favorable plantation and hotel performances. Investors should closely monitor the legal proceedings regarding the arbitration award, as well as the Group’s ability to sustain its sales momentum and manage its gearing. The absence of dividends and changes in the Group’s consolidated structure are also notable for shareholders.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult professional advisors before making investment decisions. The company’s actual results and performance may differ materially from those expressed or implied in this summary.

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