OWG (5260) : Only World eyes single-digit earnings growth

(From left) Only World executive director and general manager Ng Kuan Hua, executive director and group chief operating officer Datin Chew Lean Hong, executive director Wong Huey Miin, Koh, executive director Ooi Guan Hoe and executive chairman Datuk Dr Tengku Rethwan Tengku Mansor at the listing ceremony. Photo by Shahrin Yahya
Only World executive director and general manager Ng Kuan Hua, executive director and group chief operating officer Datin Chew Lean Hong, executive director Wong Huey Miin, Koh, executive director Ooi Guan Hoe and executive chairman Datuk Dr Tengku Rethwan Tengku Mansor at the listing ceremony. Photo by Shahrin Yahya

KUALA LUMPUR: Food service outlet (FSO) and theme park operator Only World Group Bhd is targeting single-digit earnings growth for the financial year ending June 30, 2015 (FY15), amid market expectations of weaker private sector spending and slower economic growth in Malaysia.

“As far as our business is concerned, everybody still has to eat and spend on food. In any situation, people would still like to have fun. So, I think the future growth for this industry remains strong,” said Only World managing director Datuk Richard Koh at the group’s listing ceremony yesterday.

Koh said Only World’s near-term earnings growth will be driven by the relocation of its FSOs in Genting Highlands, the opening of 10 new FSOs, as well as an increase in the number of visitors to the company’s three water theme parks after upgrading works are completed.

For its FSO business, Only World is looking to complete the relocation of nine of its FSOs in Genting Highlands, which had to be closed due to upgrading works carried out by Genting Malaysia Bhd of First World Plaza.

In addition, Only World, which is already one of the largest third-party operators in Genting Highlands, will open five new FSOs there by the third quarter of 2015 to boost its earnings.

The company is also expanding its footprint to Penang with three FSOs and to Putrajaya with two more via RM10 million from its initial public offering (IPO) proceeds.

On its water theme park business, Koh said Only World had stepped up promotional activities and provided new offerings such as light shows and fireworks to draw new visitors and retain existing ones. The theme parks are now undergoing upgrading works with RM3 million from the IPO proceeds.

While Only World is unfazed by weak market conditions, Koh said the group had taken measures to counter the effects of rising costs and the impending goods and services tax (GST). These measures include additional “value creation” in its products and improving service levels.

The group will be busy with its RM60 million Komtar tower revitalisation project in Penang. Half of the funds raised from the IPO is for the refurbishment of five floors of the tower. The project will be completed in phases, with the renovation of banquet halls at level 5 to be completed by the third quarter of 2015.

Only World’s share price fell as much as 20 sen or 22.7% to 68 sen from its IPO of 88 sen shortly after morning trade started yesterday.

However, the stock rebounded to finish its maiden trading day on the Main Market of Bursa Malaysia, up 3.98% at 91.5 sen, raising close to RM50 million to fund the group’s expansion plans.

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