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Prasarana set to achieve up to RM900m revenue for FY19

KUALA LUMPUR: Prasarana Malaysia Bhd is set to achieve up to RM900 million in revenue for the financial year ending Dec 31, 2019 (FY19).

President and group chief executive officer, Datuk Mohamed Hazlan Mohamed Hussain said this would be supported by the increase in ridership, cost optimisation and service quality.

“We have reduced costs by RM248.70 million as of June 30, 2019, exceeding the target of 10 per cent, or RM208.40 million as set by the group earlier,” he told the media at a briefing on Prasarana’s performance for the first half of 2019 here, today.

Mohamed Hazlan said as of June 30, 2019, Rapid Rail Sdn Bhd saw its ridership jump by ten per cent year-on-year (y-o-y) to 112.7 million versus 102.5 million in the same period last year.

In the same period, he said Rapid Ferry Sdn Bhd’s ridership surged to 700,000 from 200,000 previously, but Rapid Bus Sdn Bhd’s ridership slid to 81.3 million from 90.8 million previously.

“The slower growth in ridership for Rapid Bus was offset by the increase in Rapid Rail’s,” he said.

He added that Rapid Rail carried over 700,000 commuters a day compared with over 450,000 commuters ferried by Rapid Bus daily.

With the increase in ridership and cost optimisation which surpassed their 10 per cent target, Mohamed Hazlan was confident that Prasarana would be able to turn its earnings before interest, taxes, depreciation and amortisation positive in 2021.

He said that the state-owned transportation company had successfully reduced its losses by half in the first six months of the year.

An article by The Edge Malaysia Weekly last month quoted sources as saying that Prasarana’s impairments for FY18 could exceed RM30 billion.

“While details are scarce, it is understood that as a result of the impairments, Prasarana could incur after-tax losses of RM3 billion to RM5 billion for FY18,” said the weekly.

However, Mohamed Hazlan refused to confirm the figures as reported by the weekly at the press briefing today.

Moving forward, he said Prasarana would focus on initiatives like embracing digitalisation via the use of e-wallet, mobility-as-a-service (Maas), finding the first and last-mile solution, providing sustainable transportation and becoming more customer centric.

He added that the company would also focus on transit-oriented developments (TODs) to boost its revenue.

It is understood that Prasarana is looking at developing 10 TODs in the future, four of which are in the pipelines, namely Latitude 8- Dang Wangi Light Rail Transit (LRT), Ara Damansara LRT Station, IOI Puchong Jaya LRT Station and Brickfields/ Tun Sambanthan Monorail Station. – Bernama

IOI Corp’s fourth-quarter net profit jumps 30% to RM46.6m

PETALING JAYA: IOI Corp Bhd reported a 30.2% jump in net profit to RM46.6 million for the fourth quarter ended June 30, 2019 against RM35.8 million recorded in the previous corresponding period, attributed to lower net foreign currency translation loss on foreign currency denominated borrowings and deposits.

However, its revenue declined 3.5% to RM1.74 billion from RM1.8 billion.

IOI told Bursa Malaysia that its plantation segment profit contracted 33% to RM84.5 million from RM125.3 million, mainly due to lower crude palm oil (CPO) and palm kernel (PK) prices realised.

Average CPO and PK prices realised for Q4 were RM1,988/metric ton (mt) and RM1,127/mt, respectively.

Meanwhile, the resource-based manufacturing segment registered a profit of RM88.3 million, an increase of 3.9% against the RM85 million recorded in the same quarter a year ago.

For the 2019 financial year, IOI’s net profit slumped 79.4% to RM631.7 million against RM3.06 billion in its previous financial year, dragged down by lower operating profit and total net foreign currency translation loss on foreign currency denominated borrowings and deposits.

Its revenue slipped slightly by 0.4% to RM7.39 billion from RM7.42 billion.

Moving forward, IOI anticipates palm oil price to recover gradually in the new financial year 2020 as palm oil stocks decline from record high level in December 2018.

“The palm oil price will be supported by increased exports to major consuming countries such as India and China, higher demand from the biodiesel industry in Malaysia and Indonesia, and moderate production increase due to the dry weather,” it said.

It also expects total fresh fruit bunches production to improve slightly in 2020 with the higher production from the young Indonesian plantings, offsetting the temporary loss from the higher replanting rate in our Sabah plantations.

“Coupled with the anticipated improvement in crude palm oil price, we expect the plantation segment’s performance to improve in the coming financial year.”

For the resource-based manufacturing segment, the group foresees the oleochemical sub-segment will continue to perform relatively well due to the moderately low feedstock cost.