Mulpha International 2Q net profit rises amid improved performance in hospitality division and high dividend income

• The improved earnings were partly boosted by a dividend income of RM24.70 million received from the group's investment securities, in addition to better performance in the hospitality division.

KUALA LUMPUR (Aug 26): Mulpha International Bhd’s net profit rose 15.8% to RM35.77 million or earnings per share of 11.5 sen in the second quarter ended June 30, 2022 (2QFY22), from RM30.9 million or 9.72 sen a year ago.

The improved earnings were partly boosted by a dividend income of RM24.70 million received from the group's investment securities, in addition to better performance in the hospitality division.

Quarterly revenue, however, was down by 4.02% to RM251.17 million in 2QFY22, from RM261.69 million in the previous year, dragged by the property division, the group’s filing with Bursa Malaysia showed.

No dividend was declared during the quarter under review. 

According to Mulpha, its hospitality division’s revenue increased by RM41.71 million due to InterContinental Hayman Island, InterContinental Sydney and InterContinental Sanctuary Cove delivering stronger trading results as a result of recovering domestic travels, with improved occupancy rates and higher room rates.

“Increased wedding events bookings at Bimbadgen Palmers Lane and the successful Sanctuary Cove International Boat Show event during the current quarter also contributed positively to the hospitality division,” it added.

Meanwhile, it also noted that the property division recorded a lower revenue of RM58.35 million because of lower settlements in Mulpha Norwest and Sanctuary Cove developments in Australia, aligned with the challenging market from the multiple increased interest rates by the Reserve Bank of Australia.

Compared with the immediate preceding quarter of 1QFY22, its net profit expanded 24.53% from RM28.72 million, also lifted by better performance in the hospitality division, with revenue climbing up quarter-on-quarter by 29.08% from RM194.59 million.

For the cumulative six-month period ended June 30, 2022 (6MFY22), its net profit increased by 14% to RM64.49 million from RM56.55 million in 6MFY21, while revenue fell 8.13% to RM445.76 million from RM485.20 million.

Commenting on the latest quarterly result (2QFY22), the group said its Resort Hotels, InterContinental Hayman Island and InterContinental Sanctuary Cove had seen the return of stronger group and conference bookings, together with solid leisure demand. The financial results were assisted by strong room rates that exceeded pre-Covid-19 levels.

Hence, it said positive trading at the group's resort properties is expected to continue for the balance of the year, with strong group bookings in place. 

Turning into property division, the group said due to significant disruption to global supply chains and shortages of skilled labour in the Australian market, construction costs have risen materially over the past 12- to 18 months across all building sectors. This has resulted in a series of large and small builders facing financial difficulties and most builders seeking clients to contribute to the unexpected cost increases.

Hence, it said management is working with builders across all projects to mitigate these increases in construction costs.

Mulpha’s shares were closed unchanged at RM2.15 on Friday (Aug 26), giving it a market capitalisation of RM669 million.