IOI Properties Group: Navigating Challenges to Deliver a Commendable FY2025 Performance and a Solid Dividend!
Hello fellow investors and property enthusiasts!
Today, we’re diving deep into the latest financial report from one of Malaysia’s property giants, IOI Properties Group Berhad (IOIPG), for the financial year ended 30 June 2025 (FY2025). As a key player in the Malaysian real estate landscape, IOIPG’s performance offers valuable insights into the broader property market.
This report highlights a resilient performance from IOIPG, showcasing growth in its Property Investment and Hospitality & Leisure segments, which significantly mitigated a softer Property Development performance. What truly stands out is the Group’s declaration of a commendable 8.0 sen dividend for FY2025, a strong signal of commitment to shareholders amidst varying market conditions. While the Group recorded a marginal growth in revenue, we also note a decline in profit before tax compared to the previous year, primarily due to specific accounting factors. Let’s unpack the details and see what this means for the company’s future!
Core Data Highlights: A Snapshot of FY2025
IOIPG reported a marginal increase in total revenue for FY2025, reaching RM3.06 billion. However, a closer look at the profit figures reveals a more nuanced picture. Let’s examine the full-year performance:
FY2025 (Current Year)
Revenue: RM3,062.2 million
Profit Before Tax (PBT): RM1,454.4 million
Net Profit (Attributable to Owners): RM1,064.0 million
Basic Earnings Per Share (EPS): 19.32 sen
FY2024 (Preceding Year)
Revenue: RM2,939.7 million
Profit Before Tax (PBT): RM2,296.2 million
Net Profit (Attributable to Owners): RM2,061.8 million
Basic Earnings Per Share (EPS): 37.45 sen
While revenue saw a modest increase of approximately 4% to RM3.06 billion, the Profit Before Tax (PBT) for FY2025 declined by 37% to RM1.45 billion compared to RM2.30 billion in the previous financial year. This softer performance was primarily influenced by lower fair value gains from investment properties and higher interest expenses, particularly following the commencement of operations of IOI Central Boulevard Towers in Singapore. Consequently, the Net Profit attributable to owners and Basic Earnings Per Share also saw a decrease.
Segment Performance: Diverse Contributions
The Group’s diversified business model, spanning Property Development, Property Investment, and Hospitality & Leisure, showed varied performance across segments.
Property Development Segment
For FY2025, the Property Development segment achieved sales of RM1.81 billion. Malaysian projects were the primary driver, contributing RM1.62 billion (89% of total sales), led by mature developments in Klang Valley (RM946.8 million) like IOI Resort City and 16 Sierra, and vibrant townships in Johor (RM663.8 million) such as Bandar Putra Kulai. Projects in the People’s Republic of China (PRC) and Singapore contributed RM187.6 million (11%).
A positive note for this segment is the significant reduction in completed inventories, which decreased from RM1.92 billion to RM1.27 billion over the last twelve months. This reduction reflects the Group’s effective marketing campaigns and strategic product positioning, aimed at generating immediate cash flow to support ongoing development projects.
Property Investment Segment
This segment continued its robust growth, with revenue increasing by an impressive 46% year-on-year. This strong performance was underpinned by stable recurring income from key investment properties like IOI City Mall and IOI Mall Puchong. The Group also reported substantial fair value gains on its investment properties, with IOI City Mall registering RM651.4 million and IOI Mall Puchong gaining RM61.1 million. IOI City Tower One achieving full commitment rate is also expected to further boost footfall within IOI Resort City.
Hospitality & Leisure Segment
The Hospitality & Leisure segment also delivered significant growth, with revenue surging by 70% year-on-year. This was greatly buoyed by the resurgence in tourism, with Malaysia notably surpassing Thailand as the top Southeast Asian tourist destination in early 2025. This influx of visitors led to higher occupancy and average room rates across the Group’s hotels. The opening of Sheraton Grand Xiamen Jimei in March 2025 further contributed to this segment’s improved performance.
Quarterly Performance Review (Q4 FY2025 vs Q4 FY2024)
Looking at the final quarter of FY2025 (Q4 FY2025) compared to the same period last year (Q4 FY2024), IOIPG reported an overall revenue increase of 14% to RM890.2 million. More significantly, the underlying Profit Before Tax (excluding one-off items like fair value gains/losses) saw a substantial improvement of 145% to RM214.1 million. This was driven by stronger performances across most segments.
Key Quarterly Performance (Q4 FY2025 vs Q4 FY2024)
| Segment | Q4 FY2025 Revenue (RM’mil) | Q4 FY2024 Revenue (RM’mil) | Revenue Change (%) | Q4 FY2025 Underlying PBT (RM’mil) | Q4 FY2024 Underlying PBT (RM’mil) | PBT Change (%) |
|---|---|---|---|---|---|---|
| Property Development | 526.0 | 499.8 | +5% | 152.5 | 113.5 | +34% |
| Property Investment | 241.8 | 195.9 | +23% | 68.4 | 91.6 | -25% |
| Hospitality & Leisure | 117.7 | 83.2 | +41% | -0.9 (loss) | -107.0 (loss) | +99% (improvement) |
| Other Operations | 4.7 | 3.7 | +27% | 11.5 | 7.5 | +53% |
| Share of JV & Associate | – | – | – | 62.9 | -10.7 | -688% (increase) |
| Net Interest (expense)/income | – | – | – | -80.3 | -7.6 | +957% (larger expense) |
| Total | 890.2 | 782.6 | +14% | 214.1 | 87.3 | +145% |
Note: Underlying PBT excludes one-off items such as fair value gain on investment properties and reversal of impairment loss on property, plant, and equipment, net of inventories written down and impairment loss on PPE.
The Property Investment segment’s operating profit decline in Q4 was attributed to a one-off charge for leasing commission and an increase in property tax assessment in Singapore. For Hospitality & Leisure, the significant improvement in operating profit (from a large loss to a marginal one) was largely due to the absence of a substantial one-off depreciation and write-off charge that occurred in the preceding year, coupled with contributions from newly acquired and refurbished hotels.
Risk and Prospect Analysis: Charting the Course Ahead
IOIPG acknowledges the persistence of global business environment challenges and trade uncertainties. However, the Group remains cautiously optimistic, pointing to several strategic advantages and market tailwinds.
A key positive factor highlighted is the declining trend in interest rates, which bodes well for a capital-intensive industry like property. IOIPG’s strategy to counteract challenges involves leveraging its diversified product offerings across Malaysia, Singapore, and China, maintaining a sizeable recurring income stream from its established Property Investment portfolio, and capitalizing on the favourable outlook for its Hospitality & Leisure segment.
Specific opportunities and strategies include:
- Property Development: Continued focus on monetizing existing inventories to boost cash flow for ongoing projects, particularly in thriving Malaysian regions like Klang Valley and Johor.
- Property Investment: Building on the strong performance of malls like IOI City Mall and IOI Mall Puchong, and the increasing occupancy of IOI Central Boulevard Towers in Singapore (reaching 88% commitment rate). The proposed acquisition of the remaining stake in South Beach, Singapore, is set to provide IOIPG with management control, allowing it to optimize operations and unlock further value.
- Hospitality & Leisure: Anticipating a further boost from “Visit Malaysia 2026,” which is expected to drive higher tourist arrivals and a positive spillover effect for the Group’s investment properties. New hotel openings like Sheraton Grand Xiamen Jimei are already showing gradual occupancy increases.
- International Expansion: Progress in Singapore, with priority previews for W Residences Marina View and construction on track. In PRC, despite economic headwinds, new operations are gaining traction.
The Group’s proposed acquisition of a 50.1% stake in Scottsdale Properties Pte Ltd in Singapore, which holds the South Beach development, is pending completion in the second half of calendar year 2025. This move is expected to enhance the Group’s presence and control over a landmark development in Singapore.
Summary and Investment Recommendations
IOI Properties Group has demonstrated a commendable performance in FY2025, particularly in its Property Investment and Hospitality & Leisure segments, which have shown robust growth. While the overall profit before tax was impacted by lower fair value gains and higher interest expenses, the Group’s strategic focus on recurring income, inventory monetization, and international expansion underscores its resilience.
The declaration of an 8.0 sen dividend for FY2025 (up from 5.0 sen in FY2024) is a positive sign for shareholders, reflecting the company’s confidence and commitment to shareholder returns. With strong sales in core development areas, a strategic reduction in inventories, and a positive outlook for its investment and hospitality assets, IOIPG is positioning itself for sustained growth.
Looking ahead, IOIPG is well-equipped to navigate potential market challenges, banking on its diversified portfolio and strategic initiatives. The declining interest rate trend and an anticipated tourism boom could further support its trajectory.
Please note that this analysis is purely for informational purposes and does not constitute any form of investment advice, recommendation to buy, sell, or hold any securities.
Key points to consider for IOIPG’s future trajectory include:
- The successful monetization of its property development inventories to generate cash flow.
- The continued robust performance and occupancy rates of its key investment properties, especially in Singapore.
- The impact of global economic conditions and geopolitical tensions on its international segments.
- The realization of benefits from strategic acquisitions like the remaining stake in South Beach.
- The sustained recovery and growth in the tourism sector, particularly in Malaysia, boosting its Hospitality & Leisure segment.
What Are Your Thoughts?
IOIPG’s latest financial report paints a picture of a company actively managing its diverse portfolio to generate value, even when facing external pressures. By focusing on recurring income and strategically reducing inventories, they appear to be building a solid foundation. The increased dividend is certainly a highlight for investors.
Do you think IOI Properties Group can maintain this growth momentum in its Property Investment and Hospitality & Leisure segments, and will their efforts in property development truly turn the tide in the coming years? Share your insights and expectations in the comments section below! I’d love to hear your professional point of view on their performance and future prospects.
For more detailed analyses of Malaysian property companies and market trends, be sure to check out my other articles.
