SINGAPORE (May 11): Hatten Land, the property development arm of Malaysian conglomerate Hatten Group, reversed to a loss of RM74.2 million ($24.1 million) for the third quarter ended March 31, compared to its RM5.6 million of earnings posted in the same quarter a year ago.

This comes despite a more-than-doubling of revenue of RM164.9 million for the quarter from RM74 million in the previous year, which was due to higher progressive sales recognised from the Hatten City Phase 2 and Harbour City projects.

To recap, Hatten Land was formed in place of VGO Corporation after the Jan 2017 completion of an RTO by Sky Win Management Consultancy, after which the existing business of VGO Corporation was disposed.

The spike in revenue was more than offset by one-off non-operating expenses of approximately RM87.8 million – which were incurred in relation to professional fees related to its reverse takeover (RTO) of RM10 million, in addition to acquisition costs arising from the RTO of approximately RM77.8 million.

In line with the higher revenue, cost of sales increased more than doubled to RM115.8 million from RM46.2 million in the previous year.

Other income/gains were 41.9% lower at RM1.7 million from approximately RM3 million in 3Q16, mainly due to decrease in interest income from payment interest charged to purchasers and service fee income.

General and administrative expenses decreased by 36.7% to approximately RM7.5 million from about RM11.8 million the year before.

This was mainly due to lower manpower, related expenses and overheads as a result of internal restructuring of manpower in connection with the RTO.

Highlighting record revenue growth and a strong sales track record over the quarter, Colin Tan, executive chairman and managing director of Hatten Land, says the group is bracing for the upcoming completion of Hatten City Phase 2 and the launch of the Imperio Mall within this year.

“Harbour City is well on track for its completion in 2020 as we intensify our marketing drive for the project,” comments Tan in a Thursday filing to the SGX.

“With the recent acquisitions and the plans for the five slated landbanks in the pipeline, we are embarking on our new phase of expansion. In Melaka, Thea Wellness Project and MICC Project have obtained developmental order approval. Our proposed new project in Cyberjaya in Selangor marks our inroads into medical tourism through the new investment of Page 2 of 4 an integrated mixed development that will comprise retail, commercial (offices), residential, and hospitality units and a hospital,” he adds.

Following the completion of the RTO, Hatten Land has changed its presentation currency for its financial statements from SGD to RM, as well as changed its financial year end from March 31 to Jun 30.

Shares of Hatten Land closed 1 cent lower at 21 cents on Tuesday.