Written by Joseph Chin
Thursday, 17 September 2009 17:55
KUALA LUMPUR: S P Setia Bhd posted net profit of RM42.68 million for the third quarter ended July 31, 2009, up 4.45% from the RM40.86 million a year ago mainly to the strong sales recorded from its 5/95 home and commercial ownership campaign.
Announcing its results on Sept 17, it said the effects of the campaigns were beginning to be reflected in the group’s financial performance which had helped reverse the negative profit trend in the first and second quarters.
S P Setia said revenue rose 4.8% to RM317.05 million from RM302.4 million. Its earnings per share were 4.20 sen compared with 4.02 sen.
For the nine-month period, its net profit fell 16.7% to RM114.37 million from RM137.38 million in the previous corresponding quarter. Revenue declined 2.2% to RM887.46 million from RM907.57 million.
"The group’s profit and revenue were mainly derived from its property development activities carried out in the Klang Valley, Johor Bahru and Penang.
"Ongoing projects which contributed to the group’s profit and revenue include Setia Alam and Setia Eco-Park at Shah Alam, SetiaHills at Bukit Indah Ampang, Setia Walk at Pusat Bandar Puchong, Bukit Indah, Setia Indah, Setia Tropika and Setia Eco Gardens in Johor Bahru and Setia Pearl Island in Penang," it said.
Apart from property development, the group’s wood-based manufacturing activities also contributed to the earnings achieved.
Sales of the group’s PROPERTIES [] jumped from RM102 million to RM1.25 billion between Jan 31, 2009 and July 31, 2009 as the group exceeded its FY2009 sales target of RM1.1 billion by 14%, with three months to spare before the financial year-end.
"Since the launch of the 5/95 campaign on 19 January 2009, monthly sales have averaged more than RM190 million - historically the strongest and most rapid sales performance ever witnessed by the group over the duration of 6 months.
"Having already achieved its FY2009 sales target, management decided not to extend the campaign when it expired on July 19, 2009 and will focus now on ensuring that the sold properties are constructed to the group’s usual high quality standards and for timely delivery to its customers," it said.
S P Setia said whilst the group’s earnings margins were likely to remain range-bound over the near term given the costs to be absorbed by the group from the 5/95 campaign as well as the knock-on effect of the high CONSTRUCTION [] costs contracted in 2008, it was confident of the group’s prospects going
forward.
"The tremendously strong sales achieved by the Group from all its projects in the Klang Valley, Johor Bahru and Penang in such uncertain times is testament to the depth of support the group commands from Malaysian housebuyers," it added.
S P Setia said barring any further and unforeseen negative external influences, it believed the group was back on track to strongly resume its long-term growth strategy and aspirations of becoming a regional property developer.