KUALA LUMPUR: KLCCP Stapled Group recorded a revenue increase of 25 per cent to RM350.3 million in its second quarter (Q2) this year compared to RM280.2 million last year.
Pre-tax profit rose 27.4 per cent to RM219.3 million, supported by the strong performances of the retail and hotel segments as economic activity picked up in Q2.
The company declared a dividend of eight sen per stapled security, bringing the total to 16 sen for the first half of 2022.
In a statement, the company said the office segment continued to be a major contributor to the company's revenue, backed by the long-term tenancies and the triple net lease (TNL) of Petronas Twin Towers and Menara 3 PETRONAS.
The segment recorded a marginal increase in revenue to RM145.4 million whilst profit before tax (PBT) increased to RM118.4 million, attributable to higher interest income and lower financing cost resulting from lower effective interest rate upon refinancing of Sukuk Murabahah in April 2021.
Suria KLCC and the retail podium of Menara 3 Petronas, which represent the retail segment, saw an increase in revenue of 46.4 per cent to RM125.2 million, and PBT rose by 69.3 per cent to RM95.6 million, driven by higher rental from new leases and advertising income, coupled with lower rental assistance during the quarter.
The strong pick-up in retail activity saw tenant sales surpass pre-Covid levels.
The recovery in tenant sales was contributed mainly by fashion, jewellery, and food and beverages (F&B) and supported by the growing number of tourists, school holiday crowds, and major events since the gradual reopening of international borders.
"Suria KLCC will continue to benefit from the increase in retail activity as tourists return, and the mall expects more new tenants to come onboard this year," said KLCC Property Holdings Bhd chief executive officer Md Shah Mahmood.
The hotel segment's revenue jumped to RM32.1 million in Q2 compared to RM8.5 million in the same period last year.
The management services segment, comprising the company's facilities and car parking management, recorded an increase in revenue of 11.5 per cent to RM66.6 million, arising from the increase in car parking revenue with the return of office tenants and an increase in transient customers at Northwest Development (NWD) car park.
PBT, however, declined by 8.8 per cent due to additional operating expenses incurred during the quarter.
"While we expect further improvements in the remaining quarters, we are mindful of the economic headwinds that could impact and delay our recovery.
"Thus, we will remain vigilant and focused on maintaining our business stability while we continue to explore differentiation in our offerings to rejuvenate the customer experience," said Md Shah.
Moving forward, the company is optimistic about its recovery and achieving performance at pre-pandemic levels.
However, rising inflation and the increase in material costs may impede economic recovery, thus, recovery efforts may take longer than expected.
The office segment is expected to remain stable on the back of long-term tenancies. At the same time, Suria KLCC will continue to leverage the return of tourists and intensify its retail activities and promotional programmes.