Yoma profit plunges 80.6% to $0.4m

1Q2014 plagued by increased staff costs.

Yoma reported 11.6% year-on-year increase in revenue to S$15.2 million, which was driven mainly by the Group’s Real Estate division. Revenue generated by the sales of residences and Land Development Rights (LDR) contributed S$14.4 million or 94.4 % of total revenue in 1Q2014.

Sales of residences continued to attract keen interest recording a revenue growth of 48.8% year-onyear. Gross profit margin remained healthy, rising from 37.1% in 1Q2013 to 39.3% in 1Q2014.

Administrative and other operating expenses increased from S$2.2 million in 1Q2013 to S$4.1 million in 1Q2014, primarily due to an increase in the Group’s headcount and staff cost. The Group’s net profit attributable to the shareholders decreased from S$2.2 million in 1Q2013 to S$0.4 million in 1Q2014 in part as a result of these increased staff costs.

Operationally, take-up rate stayed strong for the Group’s largest residential project, Star City. As at 30 June 2013, the Group has sold 513 out of a total of 528 units in Buildings 3 and 4 in Zone A. Based on a percentageof-completion revenue recognition, the Group has to-date recognised revenue of S$7.2 million for its Star City Project with a remaining balance of approximately S$53.8 million to be recognised within the next 24 months, in tandem with construction progress.

The Group has entered into a conditional agreement with a third party investor for the sale of LDRs for 5 buildings comprising 1,043 units in Zone B of Star City, the completion of which will occur when certain conditions precedent are met. The Group will also earn additional incentive fees when certain sales targets to end buyers are met. Pertaining to the sale of LDRs in Building 1 in Zone B, the Group recognised revenue amounting to S$5.9 million in 1Q2014.

Commenting on the financial results, CEO Mr Andrew Rickards said, “Myanmar is in an extremely exciting developmental stage today, and we’re happy to report that demand for our quality projects stays strong. The slightly moderated growth in revenues this quarter compared to the previous quarter was due mainly to the slower-than-expected pace of construction for Buildings 3 and 4 in Zone A of Star City. We are confident that this should improve and allow us to recognise more of the sales in our results for the remaining periods in FY2014 which we do on a percentage of construction basis.”