Myanmar-focused Yoma sees 28.6% fall in Q1 profit

Customers in a KFC restaurant, operated by Yum! Brands Inc KFC and Yoma Strategic Holdings, in Yangon in October 2015.
Customers in a KFC restaurant, operated by Yum! Brands Inc KFC and Yoma Strategic Holdings, in Yangon in October 2015. PHOTO: BLOOMBERG

SINGAPORE - Mainboard-listed Yoma Strategic Holdings was hit by lower revenue and earnings in the three months to June 30, as it struggled amid uncertainties in Myanmar's real estate market.

Revenue for the period was S$17.6 million, down 22.4 per cent compared with a year ago, while net profit slipped 28.6 per cent year on year to S$1.8 million.

Yoma, known for its Myanmar-focused business portfolio, only managed to pull in S$3.1 million in sales of residences and land development rights, down 75 per cent from a year ago, it said when announcing results before the market opened on Tuesday (July 26).

The decrease was due to completion of property projects in previous quarters, as well as Yoma's decision to defer sales of Pun Hlaing Estate to achieve higher margins.

The non-real estate segments performed better, with the automotive business revenue rising 6.3 per cent to S$7.4 million, while the consumers business - including the KFC franchise in Myanmar - pulled in S$2.2 million.

Myanmar's property market has been affected by the new government's review on national development, which has led to delay in some high-rise construction projects. Yoma's projects are not yet affected, but it noted that buyer sentiment may have weakened in the near term.

"However, with State Counsellor Daw Aung San Suu Kyi personally chairing some of these (review) committees, the group is optimistic that good coordination and swift decisions can be made to effect positive progress," Yoma added.

Yoma shares dropped one cent or 1.65 per cent to 59.5 cents as of 11.30am, following the results announcement.