Kerjaya Prospek Property sees minimal impact from minimum wage hike; eyes land bank expansion in Klang Valley, Penang

• The group plans to launch new projects in Shah Alam and Damansara Damai in calendar year 2025, with a combined estimated gross development value (GDV) of RM700 million.

KUALA LUMPUR (Nov 26): Kerjaya Prospek Property Bhd (KL:KPPROP) expects minimal impact from the hike in the minimum wage to RM1,700 from RM1,500, as announced by the government in Budget 2025.

“Sure, it will affect [the company] a bit... wages to the contractors,” its executive chairperson Datin Seri Toh Siew Chuon (pictured) told The Edge after the analysts’ briefing following the group’s second-quarter results for the period ended Sept 30, 2024 (2QFY2025).

When asked about the potential increase in costs from the wage hike, Toh added, “We do not know; we can’t provide any projections.” The group currently employs over 200 staff, the majority of whom are locals.

On another note, Toh said that the group plans to launch new projects in Shah Alam and Damansara Damai in calendar year 2025, with a combined estimated gross development value (GDV) of RM700 million.

She also mentioned that the group aims to acquire more land, particularly in the Klang Valley and Penang, to expand its land bank. At present, the group holds 61 acres in Selangor, Kuala Lumpur, Penang, and Melaka, offering a potential GDV of RM3.8 billion until 2027.

Toh controlled Kerjaya Prospek Property alongside her spouse Datuk Seri Tee Eng Ho and her brother-in-law Datuk Tee Eng Seng, who is an executive director of the group, through their private vehicle Javawana Sdn Bhd, which holds 72.07% of the group’s shares.

Eng Ho is the non-executive chairman of builder Kerjaya Prospek Group Bhd (KL:KERJAYA) and the executive chairman of premium property developer Eastern & Oriental Bhd (KL:E&O).

For 2QFY2025, Kerjaya Prospek Property’s net profit dropped to RM4.3 million from RM22.8 million in the same period a year earlier, as revenue declined 49.13% to RM47 million from RM92.41 million.

The weaker performance was attributed to reduced contributions from its Bloomsvale project at Old Klang Road, Kuala Lumpur.

The group’s net profit margin for the quarter fell to 9.15% from 24.7% in the same quarter a year earlier.

Although the group’s other income increased by 32% to RM863,000 from RM653,000 in 2QFY2024, other costs rose significantly. Administrative expenses surged 81.15% to RM8.04 million from RM4.44 million, while other expenses more than tripled to RM3.12 million compared to RM974,000 in 2QFY2024.

For the first six months of FY2024, Kerjaya Prospek Property’s net profit shrank by 76.79% to RM10.35 million from RM44.59 million, as revenue dropped 48.32% to RM94.93 million from RM183.69 million.

Shares of Kerjaya Prospek Property slipped half a sen or 0.71% to close at 69.5 sen on Tuesday, giving it a market capitalisation of RM380.6 million.

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