Hello fellow investors and market watchers! Today, we’re diving deep into the latest financial performance of **JKG Land Berhad** as they unveil their unaudited condensed consolidated interim financial statements for the first quarter ended 30 April 2025 (Q1 FY2026). This report gives us a crucial glimpse into how the diversified Malaysian company is navigating the current economic landscape.
The headline? JKG Land saw a dip in revenue and profit compared to the same period last year, primarily due to the completion of several key property development projects. However, it’s not all about the property segment; their other business units are showing promising growth. Let’s break down the numbers and understand the story behind them.
Overall Financial Performance: A Mixed Bag
JKG Land recorded a revenue of RM50.679 million for the current quarter, which is a 9.8% decrease from RM56.178 million in the corresponding quarter of the preceding financial year. Similarly, the Profit Before Tax (PBT) stood at RM9.842 million, a 13.6% decline from RM11.390 million previously.
Key Takeaway: The overall decline in revenue and PBT is mainly attributed to the completion of three significant development projects in Kulim, Kedah, with most sales recognized in the previous financial year.
Let’s look at the core figures:
Q1 FY2026 (30-Apr-25)
Revenue: RM50,679,000
Gross Profit: RM15,437,000
Operating Profit: RM12,117,000
Profit Before Tax (PBT): RM9,842,000
Profit After Tax (PAT): RM7,179,000
Earnings Per Share (EPS): 0.32 sen
Q1 FY2025 (30-Apr-24)
Revenue: RM56,178,000
Gross Profit: RM17,468,000
Operating Profit: RM13,585,000
Profit Before Tax (PBT): RM11,390,000
Profit After Tax (PAT): RM8,402,000
Earnings Per Share (EPS): 0.37 sen
Here’s a consolidated view of the performance:
| Metric | Q1 FY2026 (RM’000) | Q1 FY2025 (RM’000) | Change (%) |
|---|---|---|---|
| Revenue | 50,679 | 56,178 | -9.8% |
| Gross Profit | 15,437 | 17,468 | -11.6% |
| Operating Profit | 12,117 | 13,585 | -10.8% |
| Profit Before Tax | 9,842 | 11,390 | -13.6% |
| Profit After Tax | 7,179 | 8,402 | -14.6% |
| Basic Earnings Per Share (sen) | 0.32 | 0.37 | -13.5% |
Segmental Performance: A Deeper Dive
JKG Land operates through three main segments: Property Development, Cultivation of Oil Palm, and Others (primarily property investment holdings and management services). Understanding each segment’s contribution is key.
Property Development
This segment, historically the largest contributor, saw a revenue decrease of 11.0% and an operating profit decrease of 13.8% compared to the corresponding quarter last year. The primary reason, as mentioned, is the completion of Phase 1S, Phase 5, and Phase 6 of Taman Puteri in Kulim, Kedah, with most sales recognized in the preceding financial year. It’s also worth noting that sales from their new launch, Phase LB in Kulim, Kedah, have yet to be recognized under MFRS accounting standards.
Property Development (Q1 FY2026)
Revenue: RM48,758,000
Operating Profit: RM11,197,000
Property Development (Q1 FY2025)
Revenue: RM54,754,000
Operating Profit: RM12,993,000
Cultivation of Oil Palm
In contrast to property, the oil palm segment delivered robust growth. Operating profit surged by 13.9% compared to the same period last year. This positive performance was driven by two key factors: higher Crude Palm Oil (CPO) prices and an increased volume of Fresh Fruit Bunches (FFB) harvested.
Oil Palm Cultivation (Q1 FY2026)
Revenue: RM824,000
Operating Profit: RM474,000
Oil Palm Cultivation (Q1 FY2025)
Revenue: RM651,000
Operating Profit: RM416,000
Others (Property Investment & Management)
This segment, which primarily generates rental income, also showed impressive improvement. Revenue increased by 41.9%, and operating profit soared by a remarkable 153.4% compared to the corresponding quarter last year. This strong growth is attributed to an increased occupancy rate for commercial properties in “RainTreeRain” and “The ERA Kuala Lumpur,” along with the addition of 9 new tenants for shops and SMI factories in the Northern Region.
Others Segment (Q1 FY2026)
Revenue: RM1,097,000
Operating Profit: RM446,000
Others Segment (Q1 FY2025)
Revenue: RM773,000
Operating Profit: RM176,000
Quarter-on-Quarter (QoQ) Comparison: Immediate Preceding Quarter
Comparing the current quarter (Q1 FY2026) with the immediate preceding quarter (Q4 FY2025 ended 31 January 2025) also provides valuable insights.
Current Quarter (Q1 FY2026)
Revenue: RM50,679,000
PBT: RM9,842,000
Immediate Preceding Quarter (Q4 FY2025)
Revenue: RM61,197,000
PBT: RM18,843,000
Revenue decreased by 17.2%, and PBT declined by 47.8% compared to the immediate preceding quarter. This significant drop is again mainly due to the aforementioned completion of property development projects in Kulim, Kedah, where most sales were recognized in the prior quarter. Additionally, the current quarter saw higher finance costs incurred, unlike the preceding quarter where interest expenses were capitalized according to MFRS 123.
Financial Health: Balance Sheet & Cash Flow
As of 30 April 2025, JKG Land’s total assets stood at RM873.618 million, a slight decrease from RM874.755 million as at 31 January 2025. Total equity attributable to owners of the company increased to RM619.005 million from RM611.825 million, reflecting the retained earnings from the period’s profit.
Cash and cash equivalents at the end of the period were RM149.350 million, a decrease from RM153.446 million at the beginning of the period. The Group’s borrowings consist solely of RM220 million in unsecured Islamic Medium Term Notes, all classified as long-term liabilities, with no short-term borrowings. This indicates a stable debt structure.
Risks and Prospects: Navigating the Market
The outlook for the property market remains a key consideration. JKG Land acknowledges that the market is expected to be relatively stable but somewhat subdued. This is largely due to broader economic headwinds, including ongoing global trade tensions, geopolitical conflicts, and cautious consumer sentiment driven by persistently rising costs.
Despite these challenges, the Board remains optimistic about delivering a favorable performance for FY2026. This optimism is fueled by encouraging take-up rates for their projects in the North and Phase 2 of “The ERA Kuala Lumpur,” which has achieved an impressive 85% sales rate. The company’s strategy revolves around focusing on high-demand locations and innovative concepts, which they believe will enable them to effectively navigate adverse market conditions.
Summary and Investment Recommendations
JKG Land Berhad’s first-quarter results present a mixed picture. While the property development segment, a core business, faced a slowdown due to project completions, the robust growth in the cultivation of oil palm and ‘Others’ segments demonstrates the benefits of the company’s diversified portfolio. The increase in CPO prices and FFB harvest, coupled with higher occupancy rates in their investment properties, provided a crucial buffer against the property segment’s headwinds.
The company’s PBT and revenue declined compared to the same period last year and the immediate preceding quarter, primarily due to the timing of property sales recognition and increased finance costs. However, the balance sheet remains healthy, with a stable debt profile and significant cash reserves.
Looking ahead, JKG Land is cautiously optimistic, banking on the strong take-up rates of its ongoing projects. The broader economic environment poses challenges, but the company’s strategic focus on high-demand areas and innovative concepts positions them to adapt.
Key points to monitor for JKG Land Berhad include:
- The sales recognition and progress of new property launches, particularly Phase LB in Kulim, Kedah.
- Sustained performance in the oil palm segment, contingent on CPO prices and FFB yields.
- Continued growth in rental income and occupancy rates for their commercial and industrial properties.
- Their ability to manage rising costs and maintain healthy profit margins amidst a subdued property market.
From a professional standpoint, JKG Land’s diversification appears to be a smart move, providing resilience in a challenging property market. While the property segment’s performance is directly tied to project completion cycles, the growth in other segments highlights potential for more consistent revenue streams. The company’s solid financial position, particularly its cash reserves and manageable debt, also provides a strong foundation.
What are your thoughts on JKG Land Berhad’s latest results? Do you think their diversified strategy will be enough to propel them to a “favourable performance” for FY2026 as the Board anticipates? Share your insights in the comments below!