KUALA LUMPUR (Aug 18): S P Setia Bhd announced a net profit of RM74.81 million in the second quarter ended June 30, 2021 (2QFY21), a marked improvement compared with a net loss of RM134.34 million last year. The group's quarterly earnings were supported by a profitable property division and absence of impairment of completed inventories.

Quarterly earnings per share stood at 1.84 sen, compared with loss per share of 3.32 sen a year ago, S P Setia filing showed.

The group's better performance was driven by better progress in terms of revenue recognition following the recovery of construction progress, it said. Quarterly revenue more than tripled to RM1.08 billion, from RM331.33 million, again as property development contributions jumped.

On a quarter-on-quarter (q-o-q) basis, however, S P Setia's RM74.81 million net profit was nearly flat, only 0.56% lower against RM75.23 million in 1QFY21. The lower performance came despite higher revenue and pre-tax profit in the quarter under review, mainly due to higher portion of profit attributable to non-controlling interests.

However, the latest quarterly earnings per share were much higher at 1.84 sen, from 0.23 sen in 1QFY21.

Revenue rose 2.85% q-o-q to RM1.08 billion, from RM1.05 billion as property development contributions grew.

The latest results helped S P Setia book a net profit of RM150.04 million or 2.07 sen per share for the cumulative six-month period ended June 30, 2021 (1HFY21), widening the gap from net loss of RM110.25 million or 4.36 sen loss per share in 1HFY20.

This was mainly because the property development segment stayed in the black with profit before tax of RM322 million against loss before tax of RM45.85 million.

Revenue, meanwhile, more than doubled to RM2.14 billion from RM1.03 billion, as all segments' revenues grew led by the two-fold increase in the property segment division contribution to RM2.03 billion, from RM958.17 million in 1HFY20.

^GDV of RM687 million properties launched in 2QFY21

S P Setia noted that sales have slowed down considerably on the onset of the Full Movement Control Order in June 2021. Local projects contributed to RM2.07 billion or approximately 77% of the sales whilst the remaining RM639 million or approximately 23% was contributed by international projects, it said.

The group launched a total gross development value (GDV) of RM687 million landed properties comprising mostly affordable double-storey terrace and/or semi-detached homes in 2QFY21, it added.

On prospects, S P Setia said it plans to launch properties worth a combined RM2.47 billion in GDV in 2H2021.

"Overall, the group remains positive and focused to accomplish its sales target of RM3.80 billion, which is underpinned by the strong pent-up demand from the homebuyers under the pandemic backdrop.

"The group is currently backed by 47 ongoing projects and an effective remaining land bank of 7,483 acres with a GDV of RM125.1 billion. Supported by an unbilled sales totalling RM10.3 billion as at June 30, 2021, this will sustain the group over the next two years," it added.

Shares of S P Setia traded unchanged at RM1.09 this afternoon, valuing the group at RM4.43 billion.