Strong performance for Eco World International projects despite Brexit concerns

KUALA LUMPUR (Oct 27): Eco World International Bhd’s (EWI) projects in UK have performed well despite concerns over the impact of Brexit on residential property demand in London, said its president and chief executive officer Datuk Teow Leong Seng.

Its project in Australia is also doing well, he added.

“With all four projects already launched, sustained buyers’ interest and strong shareholders’ support on our expansion plans, EWI is well-positioned for growth once its initial public offering (IPO) is completed,” he said in his speech at a signing ceremony between GuocoLand Ltd and Eco World Development Group Bhd (EW Bhd) for EWI’s IPO which will see GuocoLand taking up a 27% stake in EWI.

Of the four projects, three are in London while one is in Sydney, Australia with a combined estimated gross development value of £2.4 billion (RM12.2 billion).

“As at Oct 3, 2016 the cumulative sales — including reserved units — have reached approximately £1 billion. We are pleased to report that we have achieved £472 million sales — including reserved units — in FY2016 alone with close to 30% secured post-Brexit.

“This amount has exceeded the £436 million recorded in FY2015 which is testament to London’s enduring appeal as a truly global city,” said Teow.

He noted that EWI’s customer profile is almost evenly split between UK locals and Asian customers comprising investors from Malaysia, Singapore, Hong Kong and China.

“The sharp depreciation of the sterling following the Brexit vote has created a windfall opportunity for our Malaysian and Singaporean customers as well as Hong Kong and Chinese buyers keen to invest in London.

“The sustained interest from UK locals due to the three projects’ inherent appeal and unique selling points has also helped boost our sales post-Brexit,” he said, adding that the partnership provides post-IPO cash flow and earnings visibility for EWI from 2018 to 2021.

Meanwhile, executive vice-chairman of EWI Tan Sri Liew Kee Sin said he took three months to consolidate EWI’s business and look at the impact of Brexit.

“The market was bad in July and August but it bounced back from September and we’re able to turn around. Locals in London may not be buying but foreigners are flocking in due to the lower sterling,” he said, adding that EWI has sold more than 50% of the four overseas projects.

On the strategic partnership with GuocoLand, Liew said it took him nine months to negotiate the deal with GuocoLand but it “has been in the pipeline for 32 years”.

“… that’s how long we have known each other and we’ve always wanted to work together,” he said.