SP Setia sees 76.7% jump in Q2 earnings, confident of achieving RM5b sales target this year

PETALING JAYA: SP Setia Bhd's net profit surged 76.7% to RM442.74 million for the second quarter ended June 30, 2018 compared with RM250.57 million in the previous corresponding period, underpinned by higher property sales as well as a RM343.8 million one-off provisional fair value gain arising from remeasurement of existing equity stake in Setia Federal Hill Sdn Bhd.
Setia Federal Hill was previously a joint venture and now a wholly owned subsidiary of the group.
SP Setia's revenue also expanded 6.9% to RM925.97 million from RM866.35 million.
The property developer has proposed to declare an interim dividend of 4 sen per share for the quarter under review.
SP Setia's first-half net profit soared 39% to RM504.23 million from RM362.68 million, but revenue fell 16.5% to RM1.58 billion from RM1.89 billion.
The group said in a filing with the stock exchange that it secured sales of RM2.11 billion for the first half despite domestic and external challenges.
Going into the second half, its launches will focus more on the local market with emphasis given to the launches of mid-range landed properties in the Klang Valley.
"The planned major launches are in Setia Alam, Setia Ecohill, Setia Ecohill 2, Setia Eco Templer, Setia Eco Glades, Setia Sky Seputeh (Tower B), Temasya Glenmarie, Setia Alamsari and Setia Alaman with a combined GDV (gross development value) of RM2.23 billion."
SP Setia expects the local property market will continue to be subdued as the public adopts a wait-and-see approach pending a clearer direction from the authorities on housing policy matters.
"Nonetheless, the group's prospects going forward remain positive with total unbilled sales of RM8.12 billion, anchored by 46 ongoing projects and effective remaining land bank of 9,587 acres with a GDV of RM155.94 billion as at June 30, 2018."
Given the planned pipeline of launches, the sustained momentum and the strong sales achieved to-date, the group remains positive of achieving the sales target of RM5 billion for the current financial year.
At 2.50pm, its shares were trading at RM2.96, up 2 sen or 0.7% on 1.7 million shares done.