E&O May Divest Last UK Asset, Lincoln Suites, If Price Is Right

KUALA LUMPUR (Nov 28): Eastern & Oriental Bhd (KL:E&O) said it would consider selling its final UK property, the 54-unit Lincoln Suites at Princes House near Covent Garden, if it receives a suitable offer.

Managing director Kok Tuck Cheong emphasised that the group is not in a hurry to dispose of the asset, but views a potential sale as part of ongoing efforts to monetise non-core assets, manage debt, and support future development projects.

“If there is a willing buyer at the right price, we are willing to offload the asset. Even if we sell Lincoln Suites, we will continue to explore new opportunities in the UK. The decision is influenced by the current economic slowdown there,” Kok said at E&O’s second-quarter financial results briefing on Friday.

Recent UK Transactions

In August, E&O signed a deal to sell two adjoining freehold land parcels in Hammersmith—held under its indirect subsidiary Hammersmith Properties Ltd—to Varsity Capital 1 Propco Ltd for up to £90.54 million (RM515.8 million). The parcels were acquired in January 2015 for £57 million.

Previously, the group sold ESCA House in Bayswater in 2017 for £13 million, a significant reduction from its £27.65 million purchase price in 2014.

Financial Position

As of end-September 2025:

• Total borrowings: RM1.83 billion, up from RM1.71 billion in March.

• Net gearing: 0.66 times, compared with 0.59 times six months earlier.

• Cash and bank balances: RM288.2 million.

For 2QFY2026, E&O’s net profit rose 65.3% to RM50.24 million, driven by a 19.5% increase in revenue to RM204.36 million, supported by higher revenue recognition from ongoing projects, increased other income, and lower other expenses.

For the first six months of FY2025, net profit climbed 40.9% to RM95.66 million, while revenue rose 15.2% to RM387.87 million.

Market Reaction

Following the announcement, E&O shares dropped as much as 20% to 60.5 sen, marking the lowest level since January 2024. The stock closed at 71 sen, giving the company a market capitalisation of RM1.8 billion, with over 71 million shares traded.