Sime Darby Property Berhad registered a sales achievement of RM888.9 million for the first financial quarter that ended 31 March 2022 with revenue of RM480.3 million, a decrease from last year’s RM588.8 million.
Profits were also impacted recording a lower profit before tax of RM83.2 million and profit after tax and minority interest for the quarter stood at RM51.8 million. As for sales achievement, the group saw an increase in contribution from its industrial segment from 23% in the previous quarter to 31%, buoyed by sales of industrial facilities across the group’s major Klang Valley townships, with the balance mainly comprising the residential segment products.
The Gross Development Value for new product launches in FY2022 remains at RM2.8 billion of which RM383.5 million worth of products were launched in the first quarter of the year. Residential landed launches excluding statutory products in Q1 FY2022 achieved an exceptional average take-up rate of 96%, with industrial products fully taken up as of 8 May 2022. This was underpinned by the Group’s strategic launch plans focusing on the right products at prime locations with in-demand pricing that complemented the low-interest rate and targeted marketing & sales activities with seamless end-to-end online and offline purchase experiences.
Sime Darby Property’s Group Managing Director, Dato’ Azmir Merican said that the Group achieved respectable Q1 FY2022 results. “We continue to maintain financial discipline and undertake value engineering with design-to-cost principles, in view of rising cost of materials, which we expect to persist for the rest of the year compounded with labour shortages, to preserve margins and expedite construction progress. Increasing the Group’s recurring income contributions is also essential to sustain the business for the long-term, as well as land bank management and monetisation.”
Commenting on a recent announcement by the Group regarding its inaugural Industrial Development Fund, Dato’ Azmir added, “We have secured preliminary commitments of 50% for our Industrial Development Fund which has a fund size of up to US$250 million, with efforts underway for the first close, thereafter which we can expect its maiden contribution in the second half of FY2022.”
With effect from 1 January 2022, Sime Darby Property has adopted the fair value model for measurement of the Group’s investment properties, which provides a more relevant presentation and financial performance measures in line with the Group’s strategy of moving to become a real estate company.
All business segments were profitable in the quarter under review. The Property Development segment recorded a 90.7% contribution to the total revenue with RM435.7 million, which was a 21.2% YoY decline, with a 38.5% YoY reduction in PBT to RM58.3 million. The drop was mainly due to lower development activities in the City of Elmina, Serenia City, Bukit Jelutong, and KLGCC Resort, coupled with lower sales of completed inventories in KLGCC Resort, Taman Melawati, and KL East townships which are now almost sold out
The group envisages a positive outlook for the real estate market for the rest of the financial year, in particular, the residential and industrial segments as complemented by the easing of restrictions in the endemic phase.
