Sime Darby Property reports full-year profit as new real estate sales tops target

KUALA LUMPUR (Feb 25): Sime Darby Property Bhd reported a full-year net profit of RM136.9 million in the financial year ended Dec 31, 2021 (FY21) from a net loss of RM501.57 million a year earlier after a 4QFY21 turnaround which saw the property developer reporting a net profit of RM72.19 million compared to a net loss of RM56.64 million a year earlier upon resumption of site progress in the group’s property development segment as Covid-19 pandemic-driven movement restrictions eased.

In a statement to Bursa Malaysia on Thursday (Feb 24), Sime Darby Property said the group had in 4QFY21 achieved RM1 billion in new property sales and strong progress billings.

“(For the full year) Sime Darby Property recorded an impressive RM3 billion sales achievement for FY21. This exceeded the group’s FY21 sales target of RM2.4 billion and is a significant 50% year-on-year increase from the previous year,” the company said.

For 4QFY21, Sime Darby Property said revenue grew to RM739.37 million from RM705.19 million a year earlier.

For the full year, the company said cumulative FY21 revenue was up at RM2.22 billion from RM2.06 billion a year earlier.

"(In quarterly terms) Group revenue for the current quarter (4QFY21) improved to RM739.4 million from RM388.2 million, an increase of 90.4% compared with the preceding quarter. The improved performance is reflective of improved market sentiments across all segments, with revenue from the property development segment almost doubling in the current quarter.

"Accordingly, the profit for the current quarter improved significantly to RM74.3 million compared to a loss of RM15.9 million in the preceding quarter,” Sime Darby Property said.

On Sime Darby Property’s prospects, the company said that in 2022, the company will continue to be guided by its corporate priorities in growing its business in anticipation of the Malaysian economy and property market recovering.

The Malaysian economy and property market recovery in 2022 will be supported by the government’s commitment to enhance Covid-19 controls to avoid further lockdowns, according to Sime Darby Property.

"This is also aided by the continued low interest rate in the market,” the company said.

Sime Darby Property said the company's priorities include broadening the group’s recurring income streams, deepening competencies to improve resilience and market offerings, enhancing key enablers including digitalisation, innovation and sustainability to disrupt operations positively and developing new capabilities that synergise with the company's business expansion plans.

"These priorities are in place for Sime Darby Property to evolve from a pure-play developer to a real estate company. Our initiatives this year will include strategic launches across landed, high-rise and the industrial & logistics development segments, a tactical land bank monetisation programme, and introduce more recurring income streams.

"The group will also further embed sustainability principles in its businesses, as well as pilot new technology and innovation features that will complement the group’s businesses, namely in home design and placemaking.

“Total (property) bookings as at Feb 6, 2022 stood at RM2.1 billion. In 2022, the group will target a healthy pipeline of new launches with a total of RM2.8 billion in GDV (gross development value) in 2022,” Sime Darby Property said,

Looking back on FY21, Sime Darby Property said its financial results closed with the group achieving new property sales at RM3 billion, underpinned by the group’s real estate launches worth RM3.7 billion in GDV, low interest rate environment and home-buying incentives offered by the government to spur the property market.

Sime Darby Property group managing director Datuk Azmir Merican said in the statement that the group’s successful sales and financial achievements resulted from the company’s focus on growth and cost discipline throughout FY21.

“We were mindful of the challenges presented by the Covid-19 pandemic last year and focused on minimising disruptions to our business, allowing customers to continue engaging with our sales and customer service representatives. A fully redesigned home-buying experience complemented our strategic launches across the group’s master-planned townships, bringing homes, lifestyle and commerce together.

"We thank our customers and all stakeholders as we look ahead and continue to adapt with market conditions to deliver value through our quality products in FY22 and beyond,” Azmir said.

At 5pm on Thursday, Sime Darby Property’s share price closed unchanged at 65 sen for a market capitalisation of about RM4.42 billion based on the company’s 6.8 billion issued shares.

Sime Darby Property’s latest reported net assets per share stood at RM1.35.

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