Sime Darby Property’s net profit soars to RM105m in Q2

Sime Darby Property’s net profit soars to RM105m in Q2

A general view of the Sime Darby Property’s headquarters in Petaling Jaya October 2, 2019. — Reuters pic

Thursday, 25 Aug 2022 3:00 PM MYT

KUALA LUMPUR, Aug 25 — Sime Darby Property Bhd’s net profit for the second quarter ended June 30, 2022 (Q2 2022) jumped to RM105.0 million from RM23.21 million a year ago, driven by its steady product launches throughout the pandemic period which registered commendable take-up rates.

Revenue for the quarter under review also rose 22.6 per cent to RM615.61 million from RM501.97 million previously, contributed by strong development site progress at its major townships from June onwards as well as sales of products with higher margins.

In a filing with Bursa Malaysia today, the property developer said the group remains committed to achieving its product launch target of RM2.8 billion in gross development value (GDV) for 2022.

It said RM1.5 billion worth of products were launched in the first half of 2022 (H1 2022), garnering a 94 per cent average take-up rate for residential properties excluding statutory products as of Aug 7.

“The group continues to yield positive results to unlock value from its active land bank management and monetisation exercise, while total completed stocks have also been reduced to RM319.9 million as at June 30, 2022,” it said.

The group’s net profit for H1 2022 rose to RM156.56 million from RM89.31 million previously, while revenue increased to RM1.096 billion from RM1.091 billion a year ago.

On the group’s H1 2022 performance, the group said the property development segment contributed 91.5 per cent of the group’s total revenue.

“The investment and asset management segment also registered good performances, buoyed by higher revenue from KL East Mall that reflected an improved occupancy rate of 80 per cent versus last year’s 73 per cent, as well as increased footfall,” it said, adding that it was further supported by improved share of results from Melawati Mall, which also recorded higher footfall in the period under review.

The resumption of business activities in Q4 2021 contributed to the leisure segment’s RM41.2 million revenue.

“Sime Darby Property is on track to exceed its 2022 sales target based on the group’s RM1.9 billion sales achievement in H1 2022 which captures approximately 73 per cent of the RM2.6 billion full-year target,” it said.

The group also said its unbilled sales have also increased to RM3.4 billion as at June 2022 compared to RM1.8 billion in the corresponding period last year, ensuring earnings visibility for the next two years.

Sime Darby Property has declared its first interim dividend of 1.0 sen per share for the financial year ending Dec 31, 2022, amounting to RM68 million due to the strong H1 2022 results.

On the outlook, Sime Darby Property’s group managing director Datuk Azmir Merican said the group would continue to introduce more products which resonate with the market, given the encouraging demand from its recent launches.

“The group’s continued financial strength is substantiated by its cash and cash equivalents at RM820 million and net gearing of 30.3 per cent as at H1 2022, ensuring it is well positioned to fund future growth initiatives,” he said.

He also noted that the first half performance has outperformed expectations to date and the group is optimistic of surpassing this year’s sales target of RM2.6 billion, underpinned by new launches worth RM2.8 billion in GDV.

“For the remainder of the year we are looking forward to many exciting new developments including the launch of the Battersea Power Station in the United Kingdom in October, and the ongoing progress of the Industrial Development Fund through the joint venture with LOGOS Property, a new source of recurring income for the group in line with its long-term strategy,” he added. — Bernama