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SINGAPORE (Aug 29): Hatten Land on Tuesday announced that its 4Q18 earnings have dipped 95.7% to RM2.60 million ($0.86 million), compared to RM59.7 million in 4Q17.
This brings FY18 earnings to RM3.18 million, 63.5% lower than RM8.72 million in FY17.
Revenue for the quarter dropped 61.5% to RM50.1 million from RM130.0 million a year ago.
The decreased in revenue was mainly attributed to lower revenue recognised for Hatten City Phase 2 project, lower sales from Vedro by the River and Hatten City Phase 1 projects.
During the period, the group also made a provision for liquidated damages arising from late delivery and handover of the property units for Hatten City Phase 2 to the buyers, which was offset against revenue in accordance with FRS115. The liquidated damages amounting to approximately RM15.2 million are to be fully recovered from the contractor.
The decline in revenue was partially offset by the higher revenue contribution from Harbour City and Satori projects.
As cost of sales decreased by 43.1% y-o-y to RM32.4 million, gross profit for 4Q17 came in at RM17.7 million, 75.8% lower than RM73.0 million last year.
The group however saw a significant increase in its other income/gains to RM15.6 million compared to RM1.52 million in the previous year, mainly due to liquidated damages arising from late completion of units for Hatten City Phase 2 which will be fully recovered from the contractor.
Selling and distribution expenses increased by 58.5% y-o-y to RM12.1 million, while general and administrative expenses was up by 42.3% to RM14.6 million.
As at June 30, the group’s cash and cash equivalents stood at RM57.3 million.
The group has proposed a final cash dividend of 0.025 cents per share.
Colin Tan, executive chairman and managing director of Hatten Land says, “While Melaka remains our core market, we intend to diversify to new locations with the recently announced acquisition of Unicity project, an integrated mixed development located next to the MARA University of Technology in Seremban. The group will continue to pursue value-accretive growth opportunities to enhance shareholder value.”
As at 12.12pm, shares in Hatten Land are trading at 16 cents.