Petaling Jaya, 19 May 2015: Paramount Corporation Berhad (PCB) has made a good start on what looks to be a challenging year, with its property division in particular performing well.
Announcing the Group’s 1Q2015 results, PCB Group Chief Executive Officer, Jeffrey Chew said that group revenue for the period rose an exemplary 67% compared with 1Q2014 to RM165.0 million (1Q2014: RM98.8 million). This was mainly attributable to revenue from the Group’s property division, Paramount Property, which almost doubled, registering a 94% growth to RM128.46 million (1Q2014: RM66.1 million).
Revenue from PCB’s education division, Paramount Education, increased by 12% in the corresponding period, to RM36.1 million (1Q2014: RM32.3 million).
PCB group profit before tax (PBT) for 1Q2015 increased 41% to RM33.6 million (1Q2014: RM23.8 million). PBT for the property division for the 1Q2015 period increased 57% to RM29.1 million (1Q2014: RM18.5 million), mainly driven by higher progressive billings and stronger than expected sales from current developments. PBT for Paramount Education fell 16%, closing the period at RM6.1 million (1Q2014: RM7.3 million).
Paramount Property’s Sejati Residences in Cyberjaya saw keen interest in the recent quarter, fuelled by the anticipated announcement of the re-alignment of MRT 2 to Cyberjaya and Putrajaya. The Group’s Paramount Utropolis development in Glenmarie, Shah Alam, anchored by the 10-acre purpose-built KDU University College (KDUUC) campus and promising a live-and-learn, work-and-play integrated address, also saw strong sales of its SOHO’s and dual-key units, driven by positive purchaser sentiment on this unique concept.
Paramount Property also registered brisk sales of its Sekitar26 Business industrial units in Shah Alam, due to the pre-Goods & Services Tax (GST) impact on commercial property.
Paramount Education’s primary and secondary schools and the tertiary education businesses saw growth in student enrolment over the previous year. Consequently, Sri KDU Schools and KDU College Penang recorded strong growth in profits, mitigating the losses of KDUUC. The losses from KDUUC were attributable to increased costs related to the opening of the university college’s new flagship campus in Utropolis, Glenmarie, which opened its doors in January this year.
Putting the results in perspective, Chew said, “These results have given us a good foundation on which to drive growth in 2015, which we anticipate to be a challenging year. The market is feeling the impact of many different factors, which together have dampened the public’s appetite for consumption. Our strategy this year will be to make the most of the synergistic opportunities offered by our complementary businesses in property and education, whilst improving operational efficiencies.
“In property, we do see the potential for upsides. The Government is making home ownership more accessible, and improved connectivity is opening up new areas of growth in Greater Klang Valley. Buyers will, however, be more discerning. We need to up our ante on innovation, put in place more robust sales and marketing efforts, and ensure we have outstanding customer service.”
On the education front, Chew said the market was more resilient.
“Our 32-year track record has taught us that education is generally recession-proof, and can sometimes lead to growth opportunities, as it encourages students and working adults to further their academic qualifications to be more attractive to employers. Our strategy will be to make good quality education more affordable and more accessible through twinning, franchise and home-grown programmes at the tertiary level, and to offer budget schools in the primary and secondary segments,” he said.
