KUALA LUMPUR (Nov 26): UEM Sunrise Bhd's net profit grew 28% on-year to RM27.1 million in its third quarter ended Sept 30, 2019 (3QFY19), from RM21.17 million before, thanks to project development savings and higher margin from the land disposal in Iskandar Puteri.
Quarterly revenue, however, contracted 24% to RM327.61 million from RM430.1 million in 3QFY18, due to lower settlement of Aurora Melbourne Central and Conservatory, and lower sales of completed units, its stock exchange filings today showed.
For the nine-month period, however, net profit came in 63% lower at RM97.56 million versus RM260.25 million in the corresponding period last year, which UEM Sunrise said is largely because the previous year's corresponding period saw contribution from land sales that carried a significantly higher margin.
Cumulative revenue grew 35% to RM1.75 billion from RM1.29 billion previously, on higher settlement of its international projects. Property development activities contributed 92% of the company's total revenue for 9MFY19. As at Sept 30, the group's unbilled sales stood at RM2.4 billion, while property development sales was at RM720 million.
"In the absence of significant earnings contribution from land sales in this period compared to RM211 million in 9MFY18, earnings contribution from property development improved to RM138 million in comparison to RM56 million in 9MFY18," the group said.
UEM Sunrise's managing director cum chief executive officer Anwar Syahrin Abdul Ajib said the group takes cognisance of the soft property market in the year ahead and will exercise prudence in facing the challenging environment.
"We launched RM1.0 billion worth of properties to-date, the latest being Residensi AVA, Kiara Bay Kuala Lumpur, the RM656 million two 41-storey towers of residential apartments comprising 870 units sized from 813 to 1,285 square feet, on Nov 23. Other developments launched are mainly mid-market landed residences both in Central and Southern regions," he said.
UEM Sunrise said it continues to consolidate margins through smart spending and project cost savings, in addition to its strategy to divest non-strategic assets.
Shares in UEM Sunrise were traded half a sen sen up at 74.5 sen at the time of writing, bringing a market capitalisation of RM3.3 billion.