Sime Darby Property 3Q net profit falls 12.4%

KUALA LUMPUR (Nov 28): Sime Darby Property Bhd's net profit for the third quarter ended Sept 30, 2019 fell 12.4% to RM25.24 million, from RM28.8 million a year earlier, despite a sharp rise in revenue.

The quarterly revenue had jumped 77% to RM850.03 million from RM480.34 million, according to the group's filing with Bursa Malaysia.

For the nine-month period, net profit shot up to RM495.58 million from RM109.04 million last year, while revenue ballooned to RM2.29 billion from RM1.66 billion.

The group said the improved top line and bottom line for the nine-month period were due to higher contribution from its property development segment and one-off gains.

It explained that the one-off gains were mainly derived from the disposal of properties in Singapore amounting to RM208.8 million, which was in turn offset by an additional provision of RM55.8 million following disposal obligations in relation to a property sold off in the year ended Dec 31, 2017 (FY17).

Meanwhile, the group said it has netted a RM12 million disposal gain from UK properties in FY18.

On its prospects, the group said it had launched 2,320 housing units year-to-date with a combined gross development value of RM1.4 billion.

As of Sept 30, total unbilled sales for the property developer stood at RM1.6 billion, while ongoing projects and completed inventories amounted to RM2.3 billion.

"Our group's focus remains on affordable properties priced below RM500,000 and mid-range products priced between RM500,000 [and] RM800,000 per unit where demand remains strong," said Sime Darby Property yesterday.

"The group is also on track to expand into the growing industrial and logistics development segment. This includes build-to-suit, lease assets and managed industrial parks in City of Elmina and Bandar Bukit Raja," it said.

Sime Darby Property's share price closed 3.82% or three sen higher at 81.5 sen yesterday, valuing the group at RM5.54 billion.

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