S P Setia Q4 net profit falls 37% on lower contributions from all segments

PETALING JAYA: SP Setia Bhd saw its net profit for the fourth quarter ended December 31, 2017, decline by 37.32% to RM279.57 million from RM466.07 million a year ago on the back of lower contributions across all segments, namely property development, construction and other operations.
Revenue for the period fell 26.85% to RM1.45 billion from RM1.98 billion in the preceding year’s corresponding quarter, partly due to overall lower revenue recognition from Malaysia for the property development segment, after the group repositioned many launches in the last financial year to address changes in market demand.
Underpinned by an unbilled sales pipeline of RM7.72 billion, 44 ongoing projects and remaining land banks of 9,606 acres with a gross development value (GDV) of RM128.37 billion as at December 31, 2017, the group said it’s prospects going forward remain positive.
Going forward, the diversified group will be launching more landed properties in view of the demand for such developments as opposed to high rise properties, for its domestic operations.
Meanwhile on the international front, it will be launching UNO Melbourne in Melbourne, Australia with a GDV of RM1.14 billion and Daintree Residence at Toh Tuck Road, Singapore with a GDV of RM1.45 billion.
"In view of the versatile range of products offering and RM7.07 billion worth of projects launching planned for FY2018, the group has set a sales target of RM5.00 billion, of which it expects approximately 80% to come from local projects," president and CEO Datuk Khor Chap Jen said.
"We are setting a sales target of RM5.00 billion for FY2018. There is strong underlying demand for landed starter homes and mid-range properties in strategic locations with good infrastructure.Hence, we will be emphasising on the launches of mid-range landed properties in Setia Alam," he added.
For the full financial year, the group’s saw its net profit fell by 2.40% to RM932.85 million from RM955.81 million reported in the previous year.
Revenue for the period fell to RM4.52 billion from RM5.71 billion.
The stock was trading two sen lower to RM3.26 with 481,000 shares done.