KUALA LUMPUR (Nov 23): Despite lower revenue, S P Setia Bhd returned to the black in the third quarter ended Sept 30, 2021 (3QFY21), registering a net profit of RM11.01 million from a net loss of RM267.01 million a year earlier. The latest performance was supported by lower operational cost of sales and a narrowing share of losses from its joint-venture companies.
In a statement to Bursa Malaysia on Tuesday (Nov 23), the property developer said its revenue fell 44.97% to RM594.55 million for 3QFY21 from RM1.08 billion the year before.
The group did not declare any dividend for the latest quarter.
S P Setia said the group posted a lower revenue for property development as the site progress of ongoing projects was significantly disrupted by the third movement control order (MCO 3.0) from June 1.
It also explained that its 3QFY20 results were adversely impacted by the group equity accounts for its 40% share of the impairment recognised by the Battersea Power Station project of £62.4 million (RM336.3 million) in the quarter.
“Nonetheless, it is encouraging to note that the group maintained a favourable sales momentum with total sales achieved to date (as of 3QFY21) of RM3.38 billion, approximately 89% of the full-year sales target of RM3.8 billion,” S P Setia noted in the filing.
In a separate statement, Datuk Choong Kai Wai, the president and chief executive officer of S P Setia said: “We are confident of achieving the sales target for FY21 while remaining steadfast in our de-gearing initiatives to pare down borrowings and optimising our capital structure to strengthen our platform in pursuit of sustainable growth. We are optimising the use of our land bank to accelerate strategic development while ensuring alignment with the group’s environment, social and governance agenda as a responsible developer in building a sustainable community for all.”
In terms of launches, the group launched projects totalling RM1.5 billion in gross development value (GDV), mainly comprising landed terrace houses and semi-detached homes, in the cumulative nine months ended Sept 30, 2021 (9MFY21).
For 9MFY21, the group also returned to the black by posting a net profit of RM161.05 million versus a net loss of RM377.25 million a year ago.
Revenue for the period rose 29.12% to RM2.73 billion from RM2.11 billion the year before.
On a quarter-on-quarter basis, net profit fell 85.28% from RM74.81 million for 2QFY21, while revenue slid 45.09% from RM1.08 billion.
Commenting on its prospects, S P Setia said it remains positive to achieve the sales target of RM3.8 billion for FY21 after achieving total sales of RM3.38 billion in 9MFY21.
At the same time, it noted that initiatives to pare down borrowings, strengthen its capital structure, digital transformation and sustainability will remain key priorities of the group.
“Underpinned by an unbilled sales pipeline of RM9.84 billion, 48 ongoing projects and its effective remaining land bank of 7,334 acres (about 2,968 hectares) with a GDV of RM124.6 billion as at Sept 30, 2021, the group is well positioned to capture market opportunities,” it said.
At the time of writing on Tuesday, S P Setia had fallen three sen or 2.16% to RM1.35, valuing the group at RM5.65 billion.
Year to date, the counter had risen 39.18%.