This article first appeared in The Edge Financial Daily, on May 27, 2016.

KUALA LUMPUR: Premier lifestyle developer Mah Sing Group Bhd posted a net profit of RM95.03 million or 3.18 sen per share in its first financial quarter ended March 31, 2016 (1QFY16), a slight decline from the RM98.89 million or 4.63 sen a share it recorded in 1QFY15.

It saw a decrease in quarterly revenue — it came in at RM709.17 million compared with RM784.14 million in the same period last year — because M City in Jalan Ampang and Icon City in Petaling Jaya, which were in active construction stage last year, are approaching completion in the current period.

Despite a decrease in revenue from property development, there was no major fluctuation in operating profit — it slid 0.2% to RM124.1 million — mainly because of lower expenses in the current quarter, Mah Sing said in its bourse filing yesterday.

The group has planned more launches for the second half of 2016, as the first quarter of the year is a typically shorter working quarter following the festive seasons.

“In spite of that, the group achieved property sales of RM407.9 million for 1QFY16, and RM536.4 million for the four months ended April 30, 2016,” it noted.

As at March 31, 2016, the group had about RM4.53 billion in unbilled sales and a remaining gross development value (GDV) of approximately RM27.73 billion, which are expected to support the group’s revenue growth for the next eight to nine years.

In a statement, the group said the unbilled sales represent approximately 1.61 times the revenue it recognised from property in 2015, and will provide ample short-term liquidity to the group.

Mah Sing group managing director Tan Sri Leong Hoy Kum said attractive price points and good locations of the group’s projects are still generating keen interest from end-users.

“For example, the soft launch of landed link homes in Meridin East, Johor Baru was met with positive response, with over 80% take-up in less than two months. We also received encouraging bookings for new blocks in our D’Sara Sentral and Lakeville Residence.

“As the property sector undergoes consolidation, demand for affordable mass-market properties continues to outpace supply. We are well positioned for the current market condition, with 89% of our planned 2016 residential launches priced below RM1 million per unit,” he added in the same statement.

Macquarie Research, which has maintained Mah Sing as its top pick in the Malaysian property market, said the group has a weighted average take-up rate of 90% across its portfolio of 23 projects, much above Malaysia’s average of 63%, as per data provided by the National Property Information Centre.

“We believe strategic locations of its projects, mostly in the central region, combined with affordable pricing, will boost the company’s overall take-up rates.

“In addition, its 4.4% FY16 estimate dividend yield will provide additional support to the share price,” the research firm added in a May 24 note.