UOA Development jumps to record high as analysts keep ‘hold’ call, FY2023 earnings within expectations

• For FY2023, UOA Development’s net profit rose 27.1% to RM279.55 million from RM219.94 million in FY2022, despite revenue declining 11.6% to RM399.39 million from RM451.65 million.

KUALA LUMPUR (Feb 28): Shares of UOA Development Bhd rose to its record high on Wednesday, as analysts maintained their ‘hold’ call for the stock after the property developer’s financial results ended Dec 31, 2023 (FY2023) fell within their expectations.

The counter rose as much as 3.23% or six sen, to a high of RM1.92 during morning trade, before paring gains to RM1.89 as of 9.43am, with some 440,500 shares changing hands. In contrast, the benchmark index of FBM KLCI was 0.39% lower.

The counter has four “hold” ratings and one “sell” call with a 12-month median target price of RM1.80, Bloomberg data showed.

“UOA Development FY2023 core net income of RM210.2 million came in within expectations, making up 101% and 99% of our and consensus estimates,” said MIDF Amanah Investment Bank in a note on Wednesday.

Going forward, the research house anticipates subdued earnings outlook for the group, with earnings recognition from property projects expected to be muted.

“Nevertheless, [the] balance sheet of UOA Development is healthy at net cash position which allows UOA Development to grow its investment properties. Meanwhile, dividend yield is attractive at 5.4%,” said the research house.

RHB Research, meanwhile, stated that the group is projected to reach sales in 2024 that are on par with the RM827.3 million reported for FY2023.

RHB raised its FY2024-FY2025 earnings forecasts by 1%-10% for UOA Development, driven by earnings contributions from Duo Tower and Bamboo Hills Residence.

For FY2023, UOA Development’s net profit rose 27.1% to RM279.55 million from RM219.94 million in FY2022, despite revenue declining 11.6% to RM399.39 million from RM451.65 million.

Its fourth quarter net profit more than doubled to RM118.72 million from RM53.06 million a year ago, helped by a progressive recognition of its ongoing development projects.

Quarterly revenue, however, fell 3.1% to RM109.01 million from RM112.52 million previously.

The group proposed a final dividend of 10 sen per share, bringing the total dividend declared for FY2023 to 30 sen per share, compared with 10 sen per share in FY2022.

Looking to buy a home? Sign up for EdgeProp START and get exclusive rewards and vouchers for ANY home purchase in Malaysia (primary or subsale)!