Corporate, Economy, Featured and Exclusive - November 6, 2014

1MDB books RM670 mil loss

By Khairie Hisyam

1MDBState investment fund 1Malaysia Development Bhd (1MDB) booked full-year losses for the first time in four years despite revenue rising by two-thirds for the 2014 financial year.

According to 1MDB’s abbreviated accounts, the fund posted RM669.5 million in pre-tax losses for FY14 ended March 2014 compared to RM878 million in pre-tax profits for the financial year ended March 2013 (FY13). It posted a revenue of RM4.25 billion for FY14, 65% higher than RM2.59 billion recorded the previous year.

That said, the pre-tax profits for FY13 was due to some RM2.7 billion in paper profits thanks to property revaluation gains, as had been the case for the preceding two financial years. This meant 1MDB actually saw losses amounting to RM1.85 billion in FY13 if the paper gains were disregarded.

However 1MDB had some properties yet to be revalued from FY13 and it is unclear whether the pre-tax loss for FY14 came despite any gains from such revaluations.

1MDB Accounts ended 31st March (RM mil) 06114In FY13, 1MDB added RM4.4 billion in investment properties to bring its total to RM6.18 billion, but of this amount only RM2.73 billion was revalued for FY13 whereas the remaining RM1.73 billion was not revalued in that financial year.

In terms of assets, 1MDB’s abbreviated accounts for FY14 show a total of RM51.4 billion in assets, of which RM19.5 billion represent its current assets. In comparison the fund has a total of RM48.9 billion in liabilities of which RM11.12 billion are short-term liabilities.

This means for FY14 1MDB had improved its assets total by 15.5% from RM44.55 billion in FY13, while liabilities grew by 9.6% from RM44.6 billion in FY13.

At publishing time the investment fund’s full annual financial accounts for FY14, submitted to the Companies Commission of Malaysia (CCM) yesterday, was not yet available to the public as the Commission had issued a query on the accounts, CCM officials told KiniBiz today.

However the exact nature of the query was not divulged with officials only saying that the accounts would only be made available after 1MDB addresses the query.

1MDB is wholly owned by Ministry of Finance Incorporated, the Ministry of Finance’s investment arm.