GuocoLand mulls foray into industrial township development; 3Q earnings drop on higher taxes

• The group said this in a bourse filing as it reported a 38.8% year-on-year drop in its net profit for the third quarter ended March 31, 2025, primarily dragged by a higher tax burden of RM2.12 million, as opposed to a tax income of RM60,000 previously.

KUALA LUMPUR (April 29): Property developer GuocoLand (Malaysia) Bhd (KL:GUOCO), the property arm of Hong Leong Group, is undertaking a comprehensive review of its land bank to maximise its land use value. This review may include a potential foray into industrial township development to support long-term growth, it said in a bourse filing.

The group said this in a bourse filing as it reported a 38.8% year-on-year drop in its net profit for the third quarter ended March 31, 2025, primarily dragged by a higher tax burden of RM2.12 million, as opposed to a tax income of RM60,000 previously. This is due to a higher effective tax rate compared to the statutory rate due to certain expenses being non-deductible for tax purposes and losses at certain subsidiaries that could not be offset against taxable profits in other companies within the group.

Net profit fell to RM1.8 million from RM2.94 million, while revenue dipped to RM88.43 million from RM88.97 million due to lower contributions from the hospitality and property investment divisions, although this was partially offset by improved performance in the property development division. No dividend was declared for the quarter under review.

For the nine months ended March 31, 2025 (9MFY2025), net profit fell 7.93% to RM11.98 million from RM13.02 million in 9MFY2024, while revenue retreated 13.3% to RM284.29 million from RM327.73 million.

The weaker year-to-date performance was primarily due to the completion of the first phase of Emerald 9 in 9MFY2024. This was mitigated by an improved showing from the hospitality division, which benefitted from higher occupancy rates and better average room rates, and the property investment segment, which recorded higher rental income and improved cost efficiencies, particularly at DC Mall. Group profitability also benefitted from lower finance costs during the period.

Looking ahead, GuocoLand said it will maintain a focused strategy, prioritising the timely completion of ongoing projects, effective monetisation of completed properties, and disciplined financial management to navigate the volatile market environment. “New project launches will be strategically tailored and launched to align with current market demand,” the group added.

GuocoLand's shares dipped 1.5 sen or 2.50% to close at 61.5 sen on Tuesday, valuing the group at RM430.78 million.

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