S P Setia 3Q net profit jumps 67% on higher property development revenue

KUALA LUMPUR (Nov 13): SP Setia Bhd's net profit for the third quarter ended Sept 30, 2019 jumped 67.1% to RM108.93 million from RM65.19 million a year earlier, on the back of higher property development revenue.

In a filing today, the developer said revenue for the quarter slipped to RM932.07 million from RM993 million previously as it had last year completed and handed over its Australian project Maison Carnegie, of which the revenue and profits were recognised on completion basis.

Earnings per share was 1.06 sen compared to 1.67 sen earlier.

For the nine months ended Sept 30, S P Setia said net profit fell to RM300.48 million from RM569.41 million in the year-ago period. Revenue, however, rose to RM3.13 billion from RM2.57 billion a year earlier.

In a separate statement, S P Setia said the revenue and profit thus far were contributed mainly by ongoing projects in Malaysia while ongoing international projects, comprising Battersea Power Station in London, United Kingdom, as well as Sapphire by the Gardens and UNO in Melbourne, Australia, were recognised on completion method, hence there was no profit contribution from the said international projects.

It said over the same period, the group secured sales of RM3.07 billion.

"Local projects contributed RM2.60 billion, which represented approximately 85% of the total sales while international projects contributed RM467 million, which represented the remaining 15% of the total sales," it said.

S P Setia president and CEO Datuk Khor Jap Jen said amid the challenging landscape of a subdued property market, the strategy was to launch more mid-range landed properties in the group's flagship townships where the underlying demands by owner-occupiers are still favourable.

Khor said as S P Setia goes into the remaining months of FY19, another RM2.17 billion worth of gross development value (GDV) is planned to be launched.

He said the group will continue to focus on the launches of landed properties in the established townships of Klang Valley and Johor Bahru.

"This will bring the total launches for FY19 to RM4.88 billion.

"Notable launches are planned in existing townships of Setia Alam, Setia Eco Hill, Setia Eco Templer, Setia Eco Park, Bandar Kinrara, Alam Impian, Setia Eco Garden and Setia Tropika," he said.

At the midday break, S P Setia shares were 1.48% or 2 sen lower at RM1.33, valuing it at RM5.38 billion.

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