UEM Sunrise expects lower sales of RM1.2 bil this year

KUALA LUMPUR (May 18): Property developer UEM Sunrise Bhd is expecting to secure lower sales of RM1.2 billion this year, compared to the RM1.4 billion recorded last year, according to the group's managing director and chief executive officer Anwar Syahrin Abdul Ajib.

Though the group had targeted RM1 billion sales last year but exceeded the sales target, the group remains "cautious" on 2017's outlook, said Anwar.

"We are [also] a bit fussy on our launches, because we want to ensure that it will be accepted by the market. We cannot deliver the projects ahead of market needs,” he told reporters, after the group's near-five-hour-long annual general meeting here today.

Meanwhile, the group is planning to launch five property projects in Johor, Klang Valley and Melbourne — worth a total of RM1.7 billion — starting from the second half of this year, he said.

“Starting from July, we will be launching two flagship projects: Solaris Parq and Mayfair in Melbourne. These two projects would have a combined gross development value (GDV) of more than RM1.4 billion,” he said.
 
“Then, we will be looking at launching other projects: the third phase of Melia Residence and Serimbun [in Johor], and Dahlia at Serene Heights [in Bangi, Selangor],” he said. 

This year, Anwar also said UEM Sunrise would be looking to expand its land bank to increase its presence in Klang Valley, as it seeks to balance sales contribution from different regions in Malaysia.
 
For financial year ended Dec 31, 2016 (FY16), UEM Sunrise saw its development projects in the southern region generating 50% of total sales, as compared with 12%  chalked up in FY15.
 
“We are constantly on the lookout to increase our landbank size that does justice to UEM Sunrise brand. We are looking at buying more lands in Klang Valley, where we could be developing potential projects in the long run, and one that can last from 15 to 20 years,” Anwar said.
 
Currently, Anwar noted its total landbank now stands at 13,000 acres, of which 10,000 acres are located in Johor; 2,400 are in Tapah, Perak; and the remaining are spread across Kuala Lumpur and Selangor.
 
“These landbanks have the potential to generate GDV worth RM108 billion over the next 30 years,” he added.
 
Going forward, Anwar said UEM Sunrise hopes its earnings in FY17 will continue the momentum seen in its latest quarterly performance, which showed a 20-fold increase in net profit on higher revenue from its development projects, and the revision of estimated cost for completed ones.

Net profit for the quarter came in at RM61.27 million, compared with RM3.02 million a year ago, while revenue grew 110% to RM541.76 million, from RM257.75 million, thanks to higher progress of its property projects in Malaysia and Australia.
 
“We don’t want to be complacent, as we are beefing up our campaign. Hopefully, we will get an interesting offer to beef up our products, and maintain our momentum,” he added.

UEM Sunrise closed unchanged at RM1.29 today, for a market capitalisation of RM5.85 billion. — theedgemarkets.com

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