SINGAPORE (May 24): Yoma Strategic Holdings reported earnings of $35.9 million for FY17 ended March 31, a 3.2% decline from FY16 due to higher interest expenses and administrative expenses.
Revenue for FY17 was $124.2 million, 11% higher from a year ago on the back of a strong performance from the group’s non-real estate business, which contributed to 46.6% of total revenue for the year.
The proportion of this segment’s contribution indicates that the group is ahead of its 2020 target to have at least half of its revenue coming from its non-real estate businesses, says Yoma in a press release on Wednesday.
FY17 revenue from the automotive & heavy equipment business grew 27.2% to $38.1 million, largely attributed by Yoma’s New Holland tractor business.
Contributions from Yoma Fleet also grew by 61.1% on-year to $5.8 million with an increase in its fleet size to 540 vehicles as at 31 March 2017.
Meanwhile, revenue generated from the group’s consumer business, which comprises its KFC operations, more than doubled to $10.9 million from $4.6 million in FY16 with new store openings. The group is expected to open its first KFC store in Mandalay in June 2017, and is aims to increase its store count to 22 nationwide by the end of FY18.
Exceptionally, the property segment continued to see softness and revenue from the sales of residences and land development rights fell by $4 million to $46.5 million over the year.
Other income recorded an increase of 20.4% to $66.9 million, mainly driven by the fair value gains recognised from the group’s investment properties and telecommunications towers investment.
A $25.6 million fair value gain on Yoma’s investment properties was recorded, supported primarily by the progressive completion of Phase One of the group’s Dulwich International Schools, which are scheduled to be opened by end 2Q18.
Over the course of FY17, the sale of Yoma’s stake in the telecommunications towers investment led to a $32.2 million gain.
The strengthening of the USD against both SGD and Kyats resulted in a $3.6 million gain in other income, offset by a $6.3 million currency translation loss on its borrowings.
The above gains were largely offset by a spike in group administrative expenses, which grew 12.1% to $51.8 million due to the increase in staff costs, rental and lease expenses and depreciation in relation to the growing number of KFC stores and New Holland branches.
Higher interest expenses on borrowings were also recorded, rising 71.2% to $8.9 million in FY17 due to a higher amount of borrowings and a rising interest rate environment.
A final cash dividend of 0.25 cents has been proposed for FY17.
"The recent government announcement relating to the new investment rules mark a major turning point in Myanmar's efforts to spur economic growth. We remain optimistic with the business prospects ahead, which will likely translate to a gradual recovering real estate market in Yangon and a pick up on investment activities,” comments executive chairman Serge Pun.
“Yoma Strategic is well poised to benefit from these developments, and we expect the company to continue our path to grow our core business segments while assessing other opportunities as they arises.”
Yoma closed 0.5 cent higher at 57.5 cents on Tuesday.
