E&O back in the black in Q3 as strategy pays off

PROPERTY developer Eastern & Oriental Bhd (E&O) has reversed a third-quarter loss, thanks to its effective pre-emptive balance sheet management strategy and higher contribution from the properties and hospitality divisions on the back of increased revenue and lower finance costs.

It posted a net profit of RM10.5 million in the three months ended December 31 2009, a reversal from a net loss of RM4.4 million a year ago.

Revenue increased 28 per cent to RM90 million for the quarter under review, from RM70.2 million.

"The balance sheet management strategy included a capital injection of RM236 million from the group's recently-completed irredeemable convertible secured loan stocks issue exercise," it said in a statement yesterday.
Net profit for the nine-month period through December 31 2009 increased nearly fourfold to RM27.1 million from RM6.9 million a year ago.

Revenue rose by 25 per cent to RM278.7 million, compared with RM222.8 million.

E&O said it will continue with several property launches this year.

In early February, E&O launched the first block of its landmark Quayside Seafront Resort Condominiums project in Seri Tanjung Pinang, Penang, achieving a take-up rate of more than 50 per cent of the total 298 units.

Buoyed by this encouraging response, the group plans to launch the second tower by the second quarter of 2010.

By Business Times