The company's strategy is only to be expected due to the high level of unsold inventory units. Coupled with low absorption rates due to the current economic uncertainties and tight lending conditions, this has resulted in very competitive marketing promotion and price discounting by property developers.
Sime Darby Property told Bursa Malaysia today that it is currently undertaking a “tactical price review” of all unsold inventories particularly the completed development units.
“Budget 2019 has provided a number of initiatives to support home ownership. The Group envisage that these positive developments would provide a boost to the property market,” it said.
Net profit for the three months through September dropped 93% to RM28.8mil compared with RM421mil made in the same corresponding quarter a year ago.
Revenue was little changed at RM480mil, the company said in a filing with Bursa Malaysia today.
The weaker performance was largely due the share of loss of Battersea of RM5.7mil against a profit of RM86.8mil a year ago, as well as the lack of several one-off gains that boosted its results previously.
“Excluding the share of results of joint ventures and associates, property development performance registered a marked increase of 69.6% mainly contributed by higher sales and development activities at Serenia City and Denai Alam townships, Cantara Residences and Melawati Corporate Centre,” it said.