Paramount shows improved financial performance, declares 2.5 sen interim dividend

Petaling Jaya, 26 August 2022:  Paramount Corporation Berhad (Paramount) reported a 2Q2022 revenue of RM202.4 million (2Q2021: RM127.4 million) and a profit before tax (PBT) of RM15.6 million (2Q2021: RM10.2 million), which are 59% and 53% higher respectively, compared to the same period last year. Hence, the profit attributable to ordinary equity holders of the company was also higher at RM9.1 million (2Q2021: RM1.6 million).

As for its six months results, the Group’s revenue rose by 33% to RM370.5 million (6M2021: RM279.3 million) while PBT went up by 44% to RM30.2 million (6M2021: RM21.0 million) Profit attributable to ordinary equity holders of the Company for 6M2021 rose by 260% to RM14.1 million (6M2021: RM3.9 million).

With that, the Board of Directors declared a single tier interim dividend of 2.50 sen per share (2021: Nil) for the financial year ending 31 December 2022, which will be paid on 22 September 2022 to shareholders whose names appear on the Record of Depositors on 12 September 2022.

Paramount Group CEO Jeffrey Chew said, “I am pleased that the Group has delivered overall improvement in revenue and earnings for the first half of the year. This was despite challenges including the escalation of prices on building materials and shortage of construction workers, which are expected to ease when supplies normalise in the near term.”

Property division
For 2Q2022, the property division recorded a revenue of RM197.0 million, which was 57% higher than that of the corresponding quarter last year at RM125.3 million. This was on the back of a larger base of ongoing development despite work progress being disrupted due to a shortage of construction workers. The top three revenue contributors were Utropolis Batu Kawan in Penang, Sejati Lakeside in Cyberjaya, Selangor and Bukit Banyan in Sungai Petani, Kedah.

Despite the higher revenue, the property division posted a marginally lower PBT of RM18.7 million compared to RM20.6 million in 2Q2021, mainly because cost savings realised from certain completed projects were included in last year’s PBT.

For 6M2022, the property division recorded a revenue of RM361.0 million, which was a 31% increase compared to the previous period (6M2021: RM274.8 million) and a PBT of RM39.4 million, a 10% improvement from the previous period. (6M2021: RM35.7 million)

Despite fewer property launches, 6M2022 sales was 38% higher at RM425 million (6M2021: RM309 million) supported by a 113% surge in 2Q2022 sales after the full reopening of the economy and also due to the low base last year.

As at 30 June 2022, the division has unbilled sales of RM1.2 billion.

Coworking division
The coworking division recorded improved financial results with higher revenue and lower loss before tax in the first six months of 2022 compared to a year ago.  This was on the back of higher occupancy rates across all five Co-labs Coworking outlets.

Chew said the Group was optimistic that its financial performance for the second half of this year will surpass that of the first half.

“With the encouraging sales momentum achieved in 2Q2022, the Group looks forward to launching five projects (including new phases of existing projects) with a total estimated gross development value of RM1.1 billion in the second half of this year,” he said.

He said new projects lined up include Arinna, Kemuning Utama in Shah Alam (low-density high rise residential development with smart home features), The Atera in Petaling Jaya (transit-oriented mixed development situated next to the Asia Jaya Light Rail Transit Station) and Sejati Lakeside 2 in Cyberjaya (non-strata landed homes by a 45-acre lake).

He also said the Group’s coworking and workspace solutions businesses are also well positioned to capitalise on the opportunities arising from the spur of economic activities and the adoption of hybrid office set up.

“The Group will continue to maintain strong financial resilience and optimise its operations for better efficiencies. This includes increasing the use of industrialised building systems (IBS) to reduce reliance on labour over the longer term,” he said.

He said the Group will continue to explore opportunities to unlock the value of its real estate assets and investments to enhance return on capital employed while creating long-term shareholder value.