KUALA LUMPUR: KLCCP Stapled Group’s core net profit for 2022, which rebounded by 17 per cent year-on-year (YoY) to RM748.3 million, is within Affin Hwang Capital’s expectations.

The company’s core net profit accounted for 107 per cent of the street’s and 102 per cent of its full-year forecasts, Affin Hwang said.

KLCCP’s net profit was supported by higher revenue contribution from the retail (up 36 per cent), hotel (up 216 per cent) and management services (up 23 per cent) segments.

“In the retail segment, KLCCP saw sustained footfall with higher tenant sales (versus 2021), mainly contributed by fashion, food and beverage (F&B), leisure and services.

“In the fourth quarter (Q4) of 2022, KLCCP also booked in its highest tenant sales that surpassed the pre-pandemic level.

“In the hotel segment, revenue has improved sharply and the business turned earnings before interest and taxes positive during the second half of 2022, driven by higher occupancy and stronger F&B contributions,” it said.

The firm trimmed its 2023-2024 earnings forecasts by 0.1 per cent after incorporating the full-year 2022 financial statements.

“We introduce our 2025 earnings forecasts, expecting KLCCP’s 2025 core earnings per share to grow by 8.3 per cent on higher office earnings (step-up rental for PETRONAS Twin Towers),” it said.
Affin Hwang maintained a “Buy” call on KLCCP with a higher target price of RM7.80 from RM7.40 previously.

“We have lowered our cost of equity to 7.6% (from 7.9 per cent) on improved visibility in the recovery of the hospitality segment.

“We continue to like KLCCP for its defensive earnings, strong balance sheet and 2023 dividend yield of 5.8 per cent,” it added.

Source: No surprises from KLCCP’s 17pct profit growth in FY2022 (nst.com.my)