KUALA LUMPUR (Nov 18): Mega First Corp Bhd’s net profit fell 61.68% to RM14.62 million for the third quarter ended Sept 30, 2019 (3QFY19), from RM38.16 million a year earlier, no thanks to lower earnings in its power and property segments.

Earnings per share were down to 3.66 sen, from 9.78 sen.

In a bourse filing today, the company attributed the lower earnings to the absence of RM6.4 million fair value gain on investment property and pre-commercial operational expenses of Don Sahong.

Mega First’s quarterly net profit has always been above RM20 million mark, since recording RM11 million in the fourth quarter of 2015.

Quarterly revenue declined 42.71% to RM125.51 million from RM219.069 million a year ago, mainly due to a decrease in construction revenue recognition.

For the nine-month period (9MFY19), Mega First’s net profit fell 28.14% to RM70.49 million or 17.5 sen per share, from RM98.1 million or 25.12 sen last year, while revenue decreased 22.47% to RM506.4 million from RM653.19 million.

The group said it remains confident of achieving commercial operation date (COD) by the end January 2020 for the Don Sahong Hydropower Project.

It added that it expects to recognise most, if not all, of the remaining 5% of the construction revenue and profit in the final quarter of 2019.

The group is also expected to recognise some energy sales from commissioned turbines in the fourth quarter of this year.

Mega First said it intends to enter and expand its solar business, as part of the group’s strategy to expand its renewable energy investment within the power division.

Under its resource segment, Mega First noted that the regional demand of quicklime from existing customers is expected to weaken sequentially in the last quarter, as a result of slowing industrial activities. Thus, lower capacity utilisation is expected to add pressure to unit production cost in the fourth quarter of 2019.

Nonetheless, to mitigate the slowdown in the demand from existing customers, the group will continue to aggressively work on securing new customers in the region, Mega First added.

For its property segment, Mega First said while the rental income from PJ8 and Greentown carparks is expected to remain stable, the group has no plans to restart its development segment, given the weak residential property market in Malaysia.

Mega First’s shares were down three sen or 0.63% to close at RM4.75 today, valuing the group at RM1.95 billion. Year-to-date, the counter has risen by 53.8% from RM3.08.