Hot Stock Berjaya Corp falls 5% after reporting lower 1st quarter profit

by **Cals** Wed 01 Oct 2014, 07:51

Hot Stock Berjaya Corp falls 5% after reporting lower 1st quarter profit

Business & Markets 2014

Written by Ahmad Naqib Idris Adzman Shah of theedgemalaysia.com

Tuesday, 30 September 2014 13:26

KUALA LUMPUR (Sept 30): Tan Sri Vincent Tan’s Berjaya Corp Bhd fell as much as 3 sen or 5.1% in morning trading after reporting sharply lower first quarter profit.

At the 12.30pm break, Berjaya was down one sen or 1.7% at 57.5 sen, with some 74.8 million shares done. The counter was among the top actives on Bursa Malaysia.

Yesterday, Berjaya reported a net profit of RM8.3 million for its first quarter ended July 31, 2014 (1QFY15), down 84.5% from RM53.4 million in 1QFY14.

Revenue, however, jumped 23% to RM2.49 billion, from RM2.02 billion previously.

In a statement to the exchange, the group said the significantly lower profit was due mainly to lower contribution from its hotels and resorts segment.

It explained that in the previous corresponding quarter, the profit of the hotel and resorts business included the gain on disposal of a hotel property, Berjaya Singapore Hotel, of about RM94.7 million.

If not for the gain, the profit for 1QFY15 is comparable to 1QFY14, it added.

Meanwhile, Berjaya said the higher revenue for the quarter was due to its marketing of consumer products and services segment, while its retail distribution business reported lower revenue due to the closing down of non-performing stores.

Looking ahead, the group said its operating performance for the remainder of the financial year will be challenging due to the current economic outlook, but expects “good” overall financial results for the year following the acquisition of the remaining equity interests in Berjaya Starbucks Coffee Company Sdn Bhd and the proposed disposal of freehold land in Ulu Selangor, Selangor.

In a note today, Kenanga Investment Bank Bhd said Berjaya’s key support levels are at 56 sen, 54 sen and 50 sen, while its key resistances are 60 sen, 62 sen and 64 sen.