UEM Sunrise Bhd exceeds sales target of RM1.5 bil, sees strengthened earnings visibility with unbilled sales of RM2.7 bil

• As of Sept 30, 2023, the company has recorded property sales of approximately RM1.8 billion, with 41% from Central, mainly from The MINH and Residensi Allevia, both located in Mont’Kiara and The Connaught One in Cheras, while sales from the Southern region, contributed around 10%, mostly from Senadi Hills, Estuari Gardens and Almas Suites, all in Iskandar Puteri. International projects contributed 49% of secured sales during the review period.

KUALA LUMPUR (Nov 15): UEM Sunrise Bhd today announced its financial results for the nine months ended Sept 30, 2023 (YTD 3Q2023), with reported revenue of RM917 million driven mainly by its Central developments namely Residensi AVA in Kiara Bay, Residensi Allevia in Mont’Kiara, Serene Heights in Semenyih, and supported by its Southern developments such as Aspira ParkHomes, Senadi Hills and Aspira Gardens in Iskandar Puteri.

The company’s gross profit margin has improved to 33% in YTD 3Q2023 compared to 27% in the corresponding period of 2022 arising from project cost savings. In tandem with a higher gross profit margin, the operating profit has improved by 3% (compared to YTD 3Q 2022) and the company recorded a profit after tax and non-controlling interests of RM48 million for YTD 3Q 2023.

The company’s inventories have also reduced from RM203 million at the end of the last financial year to RM136 million, as of Sept 30, 2023. Its gross and net gearing of 0.62x and 0.46x, respectively, remained moderate, with cash balances of RM1.1 billion as of Sept 30, 2023. Its unbilled sales of RM2.7 billion will be substantially recognised in the next 18 to 48 months.

As of Sept 30, 2023, the company has recorded property sales of approximately RM1.8 billion, with 41% from Central, mainly from The MINH and Residensi Allevia, both located in Mont’Kiara and The Connaught One in Cheras, while sales from the Southern region, contributed around 10%, mostly from Senadi Hills, Estuari Gardens and Almas Suites, all in Iskandar Puteri. International projects contributed 49% of secured sales during the review period.

Robust turnaround plan

The company continues to focus on its three-phase strategic turnaround plan: Triage, Stabilise and Sustain, and has moved into the second stage of Triage this year.

Triage is the first phase of UEM Sunrise’s three-phase strategic turnaround plan and takes place from 2022 to 2023, followed by Stabilise (2024 to 2025) and Sustain (2026 and beyond).

“The company’s latest financial results are a reflection of our hard work and dedication in realising our turnaround plan,” said UEM Sunrise chief executive officer Sufian Abdullah (pictured).

“Our plan involves offloading inventories, non-strategic lands, and non-core assets; whilst improving retail income and occupancy,” shared Sufian. “Notwithstanding the progress we have made, there’s a lot more to be done and we are confident that we will achieve our goal of moving into the next phase of our transformation journey”, he added.

Increasing demand for RISE Series

In the coming quarters, UEM Sunrise plans to reactivate more of its remaining land in Johor. “Our intention is to activate more Southern land banks for development, especially with the renewed interest in Johor. We have plans to launch more residential projects in Gerbang Nusajaya and new phases within the Estuari, Puteri Harbour, to name a few. A new 100-acre mixed development called Puteri Harbour Avenue will also see its first launch in 2024,” Sufian said.

During the review period, the company has witnessed mostly encouraging results and has been capitalising on new opportunities in the Central region and internationally.

Sufian said: “The MINH and The Connaught One have contributed significantly to our FY2023 launches. Both developments are also the first of their kind in our Happy+ product series; The MINH is under the CLUB Edition while The Connaught One is under the RISE Series.”

“In 3Q 2023, we launched Residensi ZIG, which is our third Happy+ product this year with a biophilic design concept as well as being the second phase of our flagship township in Kepong called Kiara Bay, under a JV with Melati Ehsan Group. The three tower development features 1,126 residential units with sizes ranging between 450 sq ftto 1,508 sq. With an estimated GDV of RM646 million, this is our second RISE series product this year after The Connaught One.”

Expansion plans in Australia

On the international front, the company’s developments in Australia have contributed a significant portion towards secured sales during this review period, with the sale of its Collingwood development in Melbourne, Australia, to Greystar Real Estate Partners amounting to A$277.3 million (or RM873.7 million).

The company also acquired its first residential development site in Subiaco East in Perth, Western Australia, for A$22.2 million and will deliver two landmark apartment buildings as part of the state’s most significant urban redevelopment project at the iconic former Subiaco Oval.

The upcoming mixed-use residential precinct will comprise the delivery of sleek dual towers with approximately 430 apartments, subject to development approval, with further details to be firmed up. The project will include up to 12% affordable housing as well. Construction is expected to commence in 2026.

UEM Sunrise is one of EdgeProp START’s strategic partners. The MINH in Mont’Kiara is a development highlighted in this partnership. Check out the details here.

All UEM Sunrise​ homebuyers also get to enjoy rewards worth up to RM3,888 and stand a chance to win a set of JBL Bar 1300 speakers worth RM7,999 when you sign up on EdgeProp START from now till Dec 31.

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