PETALING JAYA (April 21) — Malaysian Resources Corp Bhd (MRCB) reported a softer financial performance for FY2025, with revenue declining 27% year-on-year to RM1.20 billion, largely due to the near completion of the LRT3 project and delays in domestic property launches.
Despite the drop in revenue, profit before tax stood at RM73.2 million, only slightly lower than the previous year, while net profit came in at RM47 million, reflecting resilience amid a transitional phase.
The Engineering, Construction & Environment (ECE) division remained MRCB’s main revenue driver, contributing RM944.8 million. However, profits declined as the LRT3 project reached 99.6% completion, limiting further earnings recognition, while newly secured projects are still in early stages.
Meanwhile, the Property Development & Investment segment saw revenue fall significantly due to fewer completed units and delayed approvals. However, losses narrowed, supported by impairment reversals—showing improved cost and asset management.
The group’s Facilities Management & Parking business continued to provide stable recurring income, managing over 19,000 parking bays across multiple sites.
One key highlight is that property sales increased 11% to RM927.4 million, driven largely by overseas projects, particularly in Australia. Developments such as Maris and Vista apartments on the Gold Coast performed strongly, alongside local contributions like TRIA 9 Seputeh in Kuala Lumpur.
Unbilled sales stood at RM1.4 billion, indicating future revenue visibility once projects are completed and handed over.
MRCB also expanded internationally with The Symphony Centre project in Auckland, further diversifying its development portfolio.
After the LRT3 wind-down, MRCB secured RM5.5 billion in new construction contracts, including major projects such as the redevelopment of Kompleks Sukan Shah Alam and reinstated LRT3 stations.
Its unbilled construction order book reached RM5.7 billion, while the total order book stood at RM18 billion, ensuring long-term income visibility.
A major milestone was the acquisition of an 80% stake in Bukit Jalil Sentral Property from the Employees Provident Fund (EPF), strengthening MRCB’s control over a key transit-oriented development.
In Cyberjaya, the group completed a land swap to consolidate prime commercial parcels, positioning itself for future development or monetisation opportunities.
Net gearing increased to 0.41 times as the company took on more debt to fund project mobilisation. However, management views this as a strategic move, expecting improvements as assets in Bukit Jalil and Cyberjaya are monetised over the next few years.
The company maintained its dividend at 1.00 sen per share, reflecting consistent shareholder returns despite earnings pressure.
Looking ahead, MRCB plans RM2.2 billion in property launches in 2026, including projects in KL Sentral, PJ Sentral, and 9 Seputeh. Property earnings are expected to recover from 2027 onwards, while construction activities will ramp up with newly secured projects.
This case shows how property and construction companies can experience temporary earnings declines during transition periods, especially when major projects near completion and new ones have yet to contribute meaningfully.
I learned that a strong order book and unbilled sales are critical indicators of future performance, even when current earnings appear weak. MRCB’s ability to secure RM5.5 billion in new projects demonstrates the importance of continuously replenishing the pipeline.
Another key insight is how strategic land acquisitions and consolidation—such as in Bukit Jalil and Cyberjaya—can create long-term value, even if they increase short-term debt levels.
Overall, this highlights the cyclical nature of the construction and property sector, where timing of project completion, launches, and approvals can significantly impact financial results, but long-term fundamentals remain driven by pipeline strength and strategic positioning.
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