PETALING JAYA (Aug 26): Sime Darby Property Bhd (SD Property) has recorded RM1.3 billion worth of sales for the first half of the financial year ended June 30, 2021 (1HFY2021), close to 84% year-on-year (y-o-y) increase and constituted 54% of the company’s 2021 sales target of RM2.4 billion.

In a virtual media briefing today presented by SD Property group managing director Datuk Azmir Merican (pictured), the achievement is attributed to aggressive and effective in-house digital marketing efforts, the ongoing Home Ownership Campaign (HOC) and the low interest rate environment.

For the first six months of FY2021, SD Property’s revenue and profit before tax increased 42.8% and 227.4% to RM1.1 billion and RM152.3 million respectively y-o-y.

Meanwhile, unbilled sales stood at RM1.83 billion.

The property development segment contributed some 93% to the company’s total revenue in 1H FY2021.

The segment achieved a revenue of RM1.1 billion, a 55% increase from last year’s RM703.5 million, and higher PBT of RM177.3 million from last year’s loss of RM107.1 million (265.5% increase).

This improvement was due to increased new sales and development activities in Sime Darby Property’s townships, namely City of Elmina, Elmina Business Park, The Glades, Bukit Jelutong and Serenia City in Selangor; KLGCC Resort in Kuala Lumpur; and Bandar Ainsdale and Nilai Impian in Negeri Sembilan, as well as higher sales of completed stocks in KL East and Melawati.

Additionally, the segment’s joint ventures and associates also registered a lower share of losses of RM6.2 million as compared to losses of RM19.0 million in the same period last year, with higher contribution from PJ Midtown and lower marketing expenses for the Battersea Power Station in the UK.

As for the investment and asset management segment, it posted a 34.5% y-o-y revenue increase to RM48.7 million and improved PBT by 256.5% to RM12.4 million. The leisure segment posted a revenue and loss before tax of RM28.9 million and RM6.3 million respectively.

Both segments were impacted by the ongoing Movement Control Order (MCO) and lockdown.

Landed homes is the key contributor of property sales

Meanwhile, the second quarter (2Q) of 2021 registered RM680.3 million sales with a revenue of RM502.8 million.

Residential landed products remained the key sales contributor, contributing to 61.1% of the total sales achieved, including the 97% take-up rate of Lyra freehold double-storey linked homes in Bandar Bukit Raja and 96% take-up of Elmina Green Four homes in the City of Elmina.

Residential high-rise was the second highest sales contributor at 21.4% while industrial landed and lots category contributed 10.9%.

“The overwhelming response for luxury high-rise Jendela Residences (launched in May) at KLGCC Resort led to the quick preview of the second tower (Phase 2) in Aug 12,” shared Azmir, adding that 78% out of 254 units were taken up as at Aug 8.

“Furthermore, take-up rates are strong for 1H residential new launches with an average take-up rate of 89% as at Aug 8,” he added.

However, in comparison with the previous quarter, the imposition of a lockdown from June 2021 disrupted the SD Property’s construction sites and sales galleries, which were not allowed to operate.

Revenue declined by 14.7% to RM502.8 million compared to the preceding quarter. PBT stood at RM57.3 million.

The property development segment recorded a revenue and PBT of RM537.7 million and RM83.3 million respectively.

The lower profit was mitigated by higher contribution from Elmina Business Park, Bandar Ainsdale, Nilai Utama, Nilai Impian, The Glades, Lot 15 SJCC and Serini Melawati.

Against the preceding quarter, the investment and asset management and leisure segments achieved lower revenue of RM24.3 million and RM13.6 million respectively, as both segments rely on the progressing to advanced phases of the National Recovery Plan which will enable SD Property assets such as KL East Mall and its award-winning golf club, TPC Kuala Lumpur to reopen.

Moving forward

On the market outlook, Azmir anticipated that the property industry will need more time to recover and business owners need to adapt to the new norm.

“We have to live with the fact that we will need to have systems in place to allow us to work during the pandemic, to keep operations ongoing… For instance, the retail and leisure sectors will soon be reopening. And there will be more open spaces and measures like [ensuring proper] ventilation will incur more costs,” said Azmir.  

Moving forward, he notes that SD Property will be more bullish on the industrial property segment amid the rise of e-commerce activities.

“We are accelerating the Group’s income diversification through the industrial landed and lots product segment which now comprises 17.8% of our sales portfolio.

“This is coupled with our focus to launch projects at strategic locations with the right price points, unlock value through active landbank management, as well as exercise vigilant cost control for the remainder of the financial year,” said Azmir.

Get the latest news @ www.EdgeProp.my

Subscribe to our Telegram channel for the latest stories and updates 

Click here for more property stories

SHARE
RELATED POSTS
  1. Sime Darby Property concludes Dragon Deals campaign with RM352 mil worth of bookings
  2. Sime Darby Property recognised for environmental leadership with Fiabci Malaysia Property Award 2023 win
  3. Sime Darby Property’s XME Boulevard phase one fully taken up