KUALA LUMPUR: IJM Corporation Bhd's earnings fell 32.3% to RM110.86mil in the second quarter ended Sept 30, 2017 due to lower contributions from its manufacturing and plantations.

It said on Tuesday its earnings fell from RM163.89mil a year ago also due to the non-recurrence of a one-off gain of RM27.9mil from an associate a year ago and also due to a net unrealised foreign exchange (forex) loss of RM400,000 compared with a gain of RM16.70mil a year ago.

The infrastructure-property-plantations company reported its revenue rose 7.2% to RM1.59bil from RM1.48bil. Earnings per share were 3.06 sen compared with 4.55 sen. It maintained its dividend payout of three sen a share.

For the six-month period, its earnings fell 15% to RM237.25mil from RM279.41mil in the previous corresponding period. Its revenue was however, higher by 9.4% to RM3.06bil from RM2.79bil.

IJM's pre-tax profit fell 12.5% to RM379.48mil from RM433.88mil mainly due to lower contributions from the group’s manufacturing & quarrying and plantation divisions and the non-recurrence of a one-off gain of RM27.9mil. It recorded a net unrealised forex loss of RM4mil versus a gain of RM10.8mil a year ago.

On the outlook, IJM said the group’s construction division expects an encouraging market outlook supported by RM8.3bil of outstanding order book, underpinned by the implementation of on-going domestic infrastructural projects as well as a healthy pipeline of new large public infrastructure projects to be rolled out under the 11th Malaysia Plan.

However, it expected the local property market to remain challenging as weak consumer sentiment persists due to uncertain market sentiments, continued stringent mortgage approval and incoming supply of new launches and competing completed properties. 

“With unbilled sales of about RM1.9bil, the property development division is expected to maintain a satisfactory performance in the current financial year,” it said.

“Despite a challenging operating environment both domestically as well as overseas, the group’s industry division should see continued growth by leveraging on heightened construction activities in Malaysia whilst supported by its healthy and strong order book position,” it said.

IJM expected a challenging financial year for the group’s plantation division due to the uncertainty in the recovery of crop production particularly in the Malaysian operations. 

As for Indonesia, notwithstanding the higher crop production from the increased young mature areas, the business environment is expected to be impacted by the volatility of the foreign exchange rates particularly the US Dollars against the Indonesian Rupiah.

However, the group’s toll and port operations will continue to provide recurrent revenue streams as its existing concessions mature thereby further enhancing the earnings of the group’s infrastructure division.