Sime Darby Property 2Q profit doubles; sets 40%-60% payout target

PETALING JAYA (Aug 24): Sime Darby Property Bhd’s net profit attributable to shareholders more than doubled to RM322.04 million for the second quarter ended June 30, 2026 (2QFY2026), from RM143.54 million a year earlier.

The group said the stronger earnings reflected improved performance in its property development and investment and asset management businesses, fair-value gains and improved contributions from joint ventures.

Revenue rose 9.3% year-on-year to RM1.16 billion from RM1.06 billion, while profit before tax (PBT) increased 82.5% to RM399.29 million from RM218.78 million, according to its unaudited quarterly report filed with Bursa Malaysia on Monday (Aug 24). Earnings per share rose to 4.74 sen from 2.11 sen.

Compared with the preceding quarter, revenue increased 45.2% from RM799.2 million, while PBT rose about 69% from RM236.3 million. Net profit attributable to shareholders climbed 102.8% from RM158.78 million.

Property development revenue jumps

Revenue from the property development segment increased 46.3% quarter-on-quarter to RM1.06 billion from RM722.5 million, driven by higher revenue recognition across all product categories, particularly industrial, residential high-rise and commercial products.

The segment's earnings improved on higher contributions from ongoing developments across key townships, mainly Bandar Bukit Raja, KLGCC Resort, Hamilton Nilai City, SJ7 and SJCC.

This was partly offset by a RM36.2 million financial impact related to a High Court order concerning a compulsory land acquisition. The group said the property development segment's results for both the current and preceding quarters also included fair-value gains recognised upon completion of investment properties.

Data-centre lease income lifts IAM revenue

Revenue from the investment and asset management (IAM) segment rose 49.9% quarter-on-quarter to RM82.6 million from RM55.1 million, mainly due to the commencement of lease income from a built-to-lease data centre.

The segment also benefited from higher contributions from KLGCC Convention Centre after it reopened following upgrading works.

Sime Darby Property said the segment's earnings were boosted by its share of profit from a joint venture following the reversal of provisions for disposal obligations upon completion of a settlement relating to a previously disposed property, alongside stronger operating performance.

Separately, the group said it incorporated a RM55.3 million gain from changes in the fair value of investment properties into its 2QFY2026 results.

The investment properties had a combined fair value of RM235.2 million, while recognition of the fair-value gain increased the group's net assets per share by 0.81 sen. The valuation was carried out in accordance with MFRS 140 Investment Property.

First-half PATAMI rises 84%

For the first half of FY2026, profit after tax and minority interests (PATAMI) rose 83.6% to RM480.82 million from RM261.95 million a year earlier.

Revenue edged up 1.3% to RM1.96 billion, while PBT increased 59.5% to RM635.56 million.

The group said the improvement in first-half PBT was mainly driven by stronger underlying performance in property development and investment and asset management, supported by fair-value gains on investment properties and improved contributions from joint ventures.

Sime Darby Property recorded RM1.8 billion in sales during the first half, with unbilled sales of RM3.8 billion. Bookings stood at RM1 billion as at Aug 9.

Barring unforeseen circumstances, the group said it remains on track to achieve its FY2026 sales target of RM4 billion and planned launches with a gross development value of RM4.7 billion.

New dividend policy announced

The company declared a first interim single-tier dividend of 1.7 sen per share for FY2026, compared with 1.5 sen a year earlier. The dividend is payable on Oct 21, with the entitlement date set for Sept 30.

Sime Darby Property also announced a dividend policy targeting a payout ratio of 40% to 60% of the group's consolidated profit attributable to owners, excluding extraordinary items.

The payout is subject to factors including the availability of distributable reserves, projected capital expenditure and investment plans, working-capital requirements, and existing and future debt obligations.

The policy takes effect immediately.

Comparative segment information was restated following an internal reorganisation that reclassified certain activities previously reported under the Leisure segment to investment and asset management, while the remaining activities are now reported under golf and sports. The group said the reclassification had no impact on reported profit, retained earnings, financial position or cash flows.

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