S P Setia's 2Q Net Profit Soars To RM295.03 Mln, Boosted By Land Sales

KUALA LUMPUR, Aug 14 (Bernama) -- S P Setia Bhd's net profit soared to RM295.03 million in the second quarter ended June 30, 2024 (2Q FY2024) from RM43.06 million in 2Q FY2023, boosted by land sales.

Revenue jumped to RM1.49 billion from RM942.71 million contributed mainly by the property development segment.

In a filing to Bursa Malaysia today, it said the property development segment achieved a revenue of RM1.43 billion in 2Q FY2024, up RM555.6 million or 64 per cent from 2Q FY2023, supported by the contribution from land sales in Taman Pelangi Indah 2, Johor.

The land sale revenue amounted to RM564 million in the quarter reviewed from RM86 million in the same period last year.

S P Setia said domestic and international under-construction and completed projects also contributed to the positive results. Revenue from other operations mainly consists of manufacturing and investment properties such as office towers, retail malls, convention centres and hotels.

In 2Q FY2024, the group also concluded the disposal of its 50 per cent equity stake in Retro Highland Sdn Bhd to MMC Land Sdn Bhd pertaining to the Taman Ikan Emas, Cheras redevelopment project, which resulted in a profit of RM56 million, according to a separate statement filed with the exchange.

Meanwhile, for the first six-month period, the company’s net profit rose to RM372.36 million versus RM98.51 million, on the back of higher revenue of RM2.97 billion against RM1.91 billion previously.

Year-to-date, S P Setia’s total land and development sales totalled RM2.3 billion, surpassing more than 50 per cent of the group’s FY2024 target of RM4.4 billion.

Local projects contributed about 96 per cent of the development sales, while the Central region dominated the development sales at 60 per cent mainly from Setia Alaman Industrial Park.

In Johor, the Southern region’s robust sales performance accounts for some 35 per cent of the development sales, with further growth potential expected from the Rapid Transit System Link infrastructure development and the establishment of the Johor Bahru–Singapore Special Economic Zone towards the later part of the year.

“We are optimistic about our operations and financial outlook for the rest of the financial year. This performance underscores our strategic focus on the Malaysian market, particularly in the Southern and Central regions," said its president and chief executive officer, Datuk Choong Kai Wai.

He said S P Setia continues to explore feasible investment opportunities and potential strategic partnerships for its lands earmarked for industrial park development, particularly in Setia Alaman and the Southern Region.

In addition, the group is poised to unveil major projects such as the first phase of Setia Federal Hill on Jalan Bangsar, Kuala Lumpur, with an estimated gross development value of RM1.4 billion.

The group’s debt has declined significantly by RM700 million within six months to RM9.4 billion as of 2Q FY2024 from RM10.1 billion in 4Q FY2023.

It noted that the net gearing ratio has consistently strengthened over the past few quarters to 0.41 times in 2Q FY2024 compared to 0.49 times in 4Q FY2023 due to the effectiveness of the group’s debt management and capital allocation strategies. 

It also achieved steady progress in inventory clearance, with RM244 million in stock reduction compared to the level in 4Q FY2023, representing 15 per cent clearance progressively through a concerted effort throughout the group.

-- BERNAMA