Lagenda Properties Berhad Navigates Q1 2025: Growth Amidst Evolving Market Dynamics
The Malaysian property sector continues to be a focal point for investors, and today, we’re diving into the latest financial performance of Lagenda Properties Berhad for its First Quarter ended 31 March 2025. This report offers a compelling look at how the company is building on its strengths, expanding its footprint, and navigating a dynamic economic landscape.
From robust revenue growth to strategic land acquisitions, Lagenda’s Q1 2025 results paint a picture of a company with clear momentum. While overall profit saw a modest rise, a deeper look reveals strategic shifts and underlying operational strength. Let’s unpack the numbers and understand what’s driving Lagenda’s journey.
Core Data Highlights: A Snapshot of Performance
Overall Financial Performance
Lagenda Properties Berhad kicked off FY2025 with a strong top-line performance, showcasing significant revenue growth. This upward trend reflects the company’s ability to drive sales and construction progress across its developments.
Q1 2025
Revenue: RM264.4 million
Profit Before Tax: RM60.4 million
Net Profit: RM44.6 million
Basic EPS: 5.32 sen
Q1 2024 (Restated)
Revenue: RM225.6 million
Profit Before Tax: RM59.1 million
Net Profit: RM42.9 million
Basic EPS: 5.10 sen
Revenue soared by 17.2% to RM264.4 million compared to RM225.6 million in the same period last year. This impressive growth translated into a 2.1% increase in Profit Before Tax (PBT), reaching RM60.4 million. Net profit also saw a healthy rise of 4.1% to RM44.6 million, with Basic Earnings Per Share (EPS) climbing 4.3% to 5.32 sen.
Segmental Breakdown: Property Development Leads, Trading Faces Headwinds
The company’s performance is driven by its two key segments: Property Development and Trading. A closer look reveals varying contributions and challenges within each.
Property Development Segment
The Property Development segment was the primary growth engine, demonstrating the success of Lagenda’s new project launches and ongoing developments.
Q1 2025
Revenue: RM235.1 million
Profit Before Tax: RM55.1 million
Q1 2024 (Restated)
Revenue: RM196.2 million
Profit Before Tax: RM59.9 million
Revenue for the Property Development segment surged by 19.8% to RM235.1 million. This was largely propelled by newly launched projects such as La’Indera Phase 1, Lagenda Ardea Phase 1A, Puncak Warisan Phase 1, and Lagenda Suria Phase 1B, alongside strong contributions from ongoing phases. However, despite the higher revenue, the segment’s PBT saw a 7.9% decline to RM55.1 million. This was mainly attributed to higher finance costs and one-off cost adjustments upon the finalisation of completed projects in the Bandar Baru Setia Awan Perdana (BBSAP) township.
Trading Segment
The Trading segment faced a tougher quarter, reflecting shifts in demand for building materials.
Q1 2025
Revenue: RM56.9 million
Profit Before Tax: RM1.4 million
Q1 2024 (Restated)
Revenue: RM72.3 million
Profit Before Tax: RM2.9 million
Revenue from the Trading segment decreased by 21.3% to RM56.9 million, resulting in a significant 53.0% drop in PBT to RM1.4 million. This decline was primarily due to reduced demand for building materials in the BBSAP and Lagenda Teluk Intan townships, as ongoing projects are nearing the Certificate of Completion and Compliance (CCC) stage.
Financial Health: Balance Sheet and Cash Flow
Lagenda’s financial position remains robust, though the quarter saw some shifts in liquidity and liabilities.
| Metric | As at 31 Mar 2025 (RM’000) | As at 31 Dec 2024 (RM’000) | Change (%) |
|---|---|---|---|
| Total Assets | 2,810,605 | 2,446,796 | +14.9% |
| Total Equity | 1,263,987 | 1,221,675 | +3.5% |
| Net Assets per Share (RM) | 1.51 | 1.46 | +3.4% |
| Total Borrowings | 988,676 | 815,297 | +21.3% |
| Cash and Cash Equivalents | 246,285 | 316,558 | -22.2% |
Total assets grew by nearly 15%, reflecting increased inventories, particularly non-current inventories, indicating investment in future projects. Total equity also saw a healthy increase, pushing Net Assets per Share higher. While total borrowings increased by 21.3%, this is a common occurrence for property developers expanding their landbank and funding new projects. Notably, cash and cash equivalents saw a decline, and the company reported a net cash outflow from operating activities of RM242.3 million for the quarter. This outflow was significantly lower than the RM440.8 million used in the same period last year, indicating an improvement in operational cash management despite the large investment in working capital for ongoing developments.
Navigating the Horizon: Risks and Prospects
Lagenda’s Q1 2025 performance comes against a backdrop of evolving macroeconomic conditions in Malaysia. While GDP growth remains resilient at 4.4% in Q1 2025, supported by household spending, there are notable external headwinds. The report highlights potential challenges such as a 24% U.S. tariff on Malaysian exports, which has led to a slight moderation in growth forecasts for 2025 to around 4.1%–4.2%. Bank Negara Malaysia has maintained its Overnight Policy Rate at 3.00% to support liquidity, and inflation remains within target, which is positive for consumer activity and the property market.
Strategic Growth Initiatives
Despite these uncertainties, Lagenda is strategically positioning itself for sustained growth. The company reported strong confirmed sales of RM251.9 million in Q1, driven by key projects like Lagenda Aman (Perak), La’Indera (Pahang), and Puncak Warisan (Johor). This demonstrates the strong market appeal of its affordable township developments.
A key highlight is Lagenda’s multi-state expansion strategy, which is clearly yielding results. As of March 2025, unbilled sales stood at a robust RM898.9 million, complemented by RM268.8 million in outstanding bookings, providing excellent revenue visibility for the upcoming quarters.
The company recently launched Phase 1 of its Kulai township in Johor in April, marking a significant milestone in its expansion. Johor remains a strategic state with over 1,500 acres of landbank and a Gross Development Value (GDV) exceeding RM5 billion. Furthermore, Lagenda made its entry into its sixth state with a land acquisition in Senawang, Negeri Sembilan, in Q1 FY2025. These expansions underscore the company’s confidence in the long-term prospects of these regions and the growing demand for affordable, well-designed housing.
Outlook
Lagenda remains confident that its unique value proposition, combining quality with affordability, will continue to resonate with a broad range of homebuyers. The Board of Directors is optimistic about FY2025, expecting it to be a successful year, barring unforeseen circumstances. The focus remains on executing the pipeline of launches and continuing a disciplined landbanking strategy in strategic, affordable locations to reach a wider demographic and address housing needs across Malaysia.
Summary and
Lagenda Properties Berhad’s Q1 2025 results demonstrate a company in a growth phase, successfully expanding its property development segment despite some softness in its trading division. The impressive revenue growth and healthy unbilled sales pipeline provide a strong foundation for future performance.
While the overall profit increase was modest due to higher finance costs and one-off adjustments in the property segment, the underlying operational strength, particularly from new project launches, remains evident. The company’s strategic focus on affordable townships and multi-state expansion is a key driver for its optimistic outlook.
However, potential investors should consider the broader economic environment and specific challenges:
- External Economic Headwinds: Global trade uncertainties, such as the U.S. tariff on Malaysian exports, could impact overall economic growth, potentially affecting consumer sentiment and property demand.
- Increased Finance Costs: The rise in finance costs impacting the property development segment’s profitability warrants attention, especially if interest rates continue to be volatile.
- Segmental Performance Disparity: The decline in the trading segment’s revenue and profit highlights a reliance on the property development arm for overall growth, and diversification strategies could be beneficial in the long run.
- Cash Flow from Operations: While improved, the continued net cash outflow from operating activities indicates significant working capital requirements for ongoing projects, which needs careful monitoring.
Lagenda appears well-positioned to capitalize on the sustained domestic demand for affordable housing. Its disciplined landbanking and expansion into new states are strategic moves that could unlock significant long-term value. The company’s ability to manage costs, especially finance costs, and adapt to changing market demands will be crucial for maintaining its growth trajectory.
Final Thoughts and Your Perspective
Lagenda Properties Berhad’s Q1 2025 report showcases a company actively executing its growth strategy, marked by significant expansion and a robust project pipeline. While the property development segment is clearly leading the charge, the challenges faced by the trading segment and the increase in finance costs highlight areas for continued management focus. The company’s commitment to affordable housing and strategic land acquisitions positions it well within the Malaysian market.
What are your thoughts on Lagenda’s latest performance? Do you believe the company can sustain this growth momentum in the coming quarters, especially with its ambitious multi-state expansion? Share your insights and perspectives in the comments below!
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