KUALA LUMPUR: Eco World International Bhd (EWI), which posted a net profit of RM13.57mil in the financial year ended Oct 31, 2021 (FY21), is targeting RM2bil in property sales in FY22.
“Although FY21 was a challenging year for EWI as lockdowns, border closures and higher stamp duties following the expiry of the UK stamp duty holiday in June 2021 adversely impacted property demand, we expect FY22 to be a much better year for property sales in London,” EWI president & CEO Datuk Teow Leong Seng said.
“Our strategies to offer additional incentives to purchasers and higher commissions to agents to accelerate the clearance of stock was effective in sustaining our sales rate in 4Q 2021. In FY22 we will continue pursuing the strategic decision made in FY21 to prioritise cash generation.
“Accordingly, we have set a higher sales target of RM2bil to be achieved for FY2022.
“As at Nov 30, one month into FY2022, we have already secured RM116mil sales and we expect sales interest to continue picking up in the ensuing months,” Teow said.
He noted that whilst house prices in Inner London took a hit in 2021 which impacted demand for some of the EcoWorld Ballymore projects, by Sept 2021 prices had recovered to the same levels as Sept 2020.
The London Rental Price Index has also been holding steady with a slight increase from FY20 which forms a strong base support for prices of properties to be sold going forward.
Outer London prices performed better as demand was dominated by local UK owner-occupiers as evidenced by the higher sales achieved by its EcoWorld London portfolio in FY2021
In FY21, EWI achieved sales of RM1.377bil in FY21, close to the RM1.382bil sales posted in FY20.
It posted a gross profit of RM120.1mil for FY21 following completion and handover of units sold to customers on its Australian projects, an increase from the RM99.99mil recorded in FY20.
EWI said the share of results in joint-ventures was lower at RM47.2mil against RM176.8mil achieved in FY20.
This is partly due to additional incentives given to purchasers of completed units within the EcoWorld-Ballymore portfolio and higher commissions paid to agents to accelerate sales after the expiry of the UK stamp duty holiday in June 2021.