Yoma Strategic reports fiscal 2Q net profit surged 611 percent as property development revenue rose

Yoma Strategic reported on Thursday that its net profit attributable to equity holders for the fiscal second quarter jumped 611 percent on-year to S$26.2 million as revenue from real estate sales more than doubled on-year.

Revenue for the quarter ended 30 September rose 26.5 percent on-year to S$41.9 million, on a “robust” performance from Yoma Land, Yoma F&B and Yoma Financial Services, partly offset by a revenue decline at Yoma Motors, it said in a filing to SGX before the market open on Thursday.

The real estate development business’ revenue increased 129.8 percent on-year to S$22.6 million in the fiscal second quarter, mainl on new apartment sales in StarCity Galaxy Tower 2 and Tower 4, which are nearing completion, it said. The residual revenue recognition from previously sold units in  Pun Hlaing Estate, StarCity Zone C and Yoma Central also increased sales of the additional units, it said.

Yoma Strategic said that it transferred 200 units in Galaxy Tower 2 and Tower 4 and the rest of StarCity Zone C from development properties to investment properties, resulting in a fair value gain of S$58.5 million in other income. That allows the company to earn rental income from the units while reducing unsold inventory, it said.

The company also expanded its City Loft property offering, which offers housing targeting the middle-income market in Yangon with an accessible price point and arrangement of mortgages with repayment terms of up to 25 years, it said. Half of the first phase of around 250 units sold out within a week, it said, with additional phases to be launched in coming months.

“I’m encouraged by the turnaround in real estate. In particular, the overwhelmingly positive response for City Loft, our new mass market housing offering, provides a springboard for a very important line of business that has huge potential to solve the housing shortage in Yangon,” Melvyn Pun, Yoma’s CEO, said in the statement.

Revenue from Yoma Motors fell 40.7 percent on-year to S$7.66 million in the quarter, mainly on a strong monsoon at the beginning of the quarter in parts of Myanmar, which affected farmers and caused delays in delivering the second 500-tractor order under the Ministry of Agriculture and Irrigation’s nationwide mechanization program, Yoma said.

Revenue from KFC stores rose to S$4.61 million in the quarter from S$3.28 million in the year-ago period on a higher number of stores and same-store-sales growth of 9 percent for stores open at least 12 months, it said. Two new outlet openings in the fiscal second quarter brought the total nationwide to 26 as of 30 September, it said.

Yoma is preparing the opening of its first Little Sheep Hot Pot restaurant in Yangon by the end of the fiscal year, while this week it announced a franchise agreement to bring Auntie Anne’s outlets to the country, it said.

Wave Money, under Yoma Financial Services, saw revenue and transaction numbers rise more than 60.1 percent and 74.7 percent on-quarter respectively in the fiscal second quarter, it said.

“Wave Money is building on its leadership position in mobile financial services in Myanmar, reached its cash-flow breakeven point and expanded its agent network to 34,000 locations in this quarter,” Pun said.

This article was originally published on Thursday 8 November 2018 at 7:59 A.M. SGT; it has since been updated.