Sunway on track to exceed RM1.3b sales target, declares dividend

KUALA LUMPUR (Aug 22): Sunway Bhd’s second quarter profit saw a marginal 1% rise to RM199.44 million, from RM196.05 million a year earlier, on higher contributions from mainly the construction sector, even after accounting for the MFRS15 adoption.

Earnings per share for the quarter ended June 30, 2018 (2QFY18) dropped to 4.09 sen from 4.11 sen previously, the group said in a statement.

Quarterly revenue, meanwhile increased 4% to RM1.29 billion from RM1.24 billion.

Sunway said the profit after tax and minority interest (PATMI) of RM199.4 million for the quarter was only marginally higher due to the adoption of MFRS 15.

The Malaysian Financial Reporting Standard 15, Revenue from Contracts with Customers (MFRS 15), establishes principles for reporting useful information related to the nature, amount, timing and uncertainty of revenue and cashflows arising from an entity’s contracts with customers.

“With the adoption of MFRS 15, recognition of progressive profits of RM28.3 million from one of the group’s Singapore property development projects which could have been recognised in the current quarter under the progressive revenue recognition treatment, had to be deferred until its completion,” Sunway said.

“Excluding the effects of the adoption of MFRS 15 in the current quarter, the group’s PATMI would have been up by 16.2% from the previous year’s corresponding quarter,” it said.

Sunway announced a single interim dividend of 3.5 sen, payable on October 18.

The group said revenue for the construction segment was higher by 44.6%, thanks to higher progress billings and local construction projects.

The group’s construction outstanding order book stands at RM5.8 billion, with an order book replenishment of RM854 million achieved to-date, it said.

Its property segment revenue however dropped 67.2%, due to lower progress billings and also the adoption of MFRS 15 on the group’s Singapore property development project.

Regardless, the group said it is confident of delivering satisfactory performance in the second half.

“We are on track to exceed this year’s sales target of RM1.3 billion, as property sales have already hit the mark as at August 2018, with the exciting launch of Sunway Velocity Two expected in 2H 2018,” said Sarena Cheah, the managing director of Sunway’s property development.

As at June 30, 2018, property unbilled sales stood at RM1.5 billion.

For the first half of the year, net profit rose 6% to RM321.36 million from RM302.94 million last year, while revenue rose 11% to RM2.6 billion, from RM2.33 billion a year ago.

Shares of Sunway closed unchanged yesterday at RM1.56, with 2.74 million shares traded, for a market capitalisation of RM7.59 billion. — theedgemarkets.com

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