Friday 29 Mar 2024
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This article first appeared in The Edge Financial Daily on November 14, 2019

KUALA LUMPUR: S P Setia Bhd’s net profit for the third quarter ended Sept 30, 2019 (3QFY19) jumped 67.1% to RM108.93 million from RM65.19 million a year ago, on higher property development revenue.

Earnings per share for the quarter was lower at 1.06 sen for 3QFY19 compared with 1.67 sen for 3QFY18, due to the dilutive effect on payment of preferential dividends paid during the period under review.

Quarterly revenue fell 6.1% to RM932.07 million for 3QFY19 from RM993 million a year ago as it had last year completed and handed over its Australian project Maison Carnegie, of which the revenue and profits were recognised on completion basis.

For the nine months ended Sept 30, 2019 (9MFY19), S P Setia’s net profit dropped 47.2% to RM300.48 million from RM569.41 million. However, revenue rose 21.7% to RM3.13 billion from RM2.57 billion for 9MFY18.

Over the same period, the group secured sales of RM3.07 billion.

“Local projects contributed RM2.6 billion, which represented 85% of the total sales while international projects contributed RM467 million, which represented the remaining 15% of the total sales,” it said in a statement yesterday.

S P Setia said the revenue and profit thus far were contributed mainly by ongoing projects in Malaysia while ongoing international projects, comprising Battersea Power Station in London, the UK, as well as Sapphire by the Gardens and UNO in Melbourne, Australia, were recognised on completion method, hence there was no profit contribution from the said international projects.

Its president and chief executive officer Datuk Khor Jap Jen said amid the challenging landscape of a subdued property market, the strategy was to launch more mid-range landed properties in the group’s flagship townships where the underlying demands by owner-occupiers are still favourable.

As S P Setia goes into the remaining months of FY19, another RM2.17 billion worth of gross development value (GDV) will be launched, he added.

“This will bring the total launches in FY19 to RM4.88 billion,” he said, noting that the group will continue to focus on the launches of landed properties in the Klang Valley and Johor Baru.

As of Sept 30, the group had 46 ongoing projects, with an effective remaining land bank of 8,984 acres (3,635.7 ha) valued at a GDV of RM143.82 billion and total unbilled sales of RM10.52 billion.

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