Malaysian Resources Corporation Berhad (MRCB) recorded a 34% decline in revenue to RM590.3 million and a loss before tax of RM62.6 million in the nine months ended 30 September 2021 (9M 2021), compared to a loss before tax of RM190.4 million in the corresponding period in 2020.
The lower revenue was due to the Enhanced and Full Movement Control Orders that resulted in construction site closures between June and August 2021, which were much longer than those during the same period in 2020, and thereafter major disruptions in the building materials supply chain.
This significantly impacted construction progress that was already impacted by on-going COVID-19 restrictions and an on-going shortage of workers. The 67% narrowing of losses was due to a RM197.4 million provision made for the impairment of contract assets, trade and other receivables as a result of the pandemic in 2020.
The Property Development & Investment Division recorded a 29% decline in revenue to RM345.9 million and a 60% decline in profit to RM17.6 million in the nine months ended 30 September 2021, compared to RM489.4 million and RM44.4 million respectively in the corresponding period in 2020.
The lower revenue and profit was largely due to only 45 units achieving financial settlement at 1060 Carnegie in Melbourne in the nine months ended 30 September 2021, compared to 104 units in the corresponding period in 2020.
Revenue and profit recognition was also hampered by slow construction progress due to site closures and restrictions in Malaysia, affecting contributions from Sentral Suites in KL Sentral, the 9 Seputeh mixed residential development in Jalan Klang Lama and Alstonia in Bukit Rahman Putra.
The Division sold RM165.2 million worth of properties in the first nine months of 2021 and had unbilled property sales of RM941 million.
The Engineering, Construction & Environment Division recorded revenue of RM206.5 million and a loss of RM51.7 million in the first nine months of 2021.
Revenue was mainly contributed by the construction of the EPF Headquarters at Kwasa Sentral, Damansara-Shah Alam Elevated Highway Package CB2, Mass Rapid Transit Line 2 Package V210, and Sungai Besi-Ulu Kelang Elevated Expressway Package CA2.
The loss, while showing a marked improvement compared to the corresponding period in 2020, was largely due to site closures and significant supply chain disruptions which continued to impact construction progress.
The Group’s LRT3 project joint venture company, Setia Utama LRT 3 Sdn Bhd (SULSB) (formerly known as MRCB George Kent Sdn Bhd), contributed profits after tax of RM18.8 million compared with RM1.6 million in the corresponding period in 2020, due to higher construction progress.
Following the acquisition of the remaining 50% equity interest, SULSB is now a wholly-owned indirect subsidiary, and the Group will now be able to recognise 100% of the profits from SULSB moving forward.