KUALA LUMPUR: Sime Darby Property Bhd is maintaining its 2019 sales target of RM2.3bil for this year as it expects a challenging outlook for the property market in 2020.
Acting group chief executive officer Datuk Wan Hashimi Albakri said the group had decided to set a conservative sales target for this year despite a stellar performance in 2019.
“We anticipate 2020 to be a soft, challenging market. With everything that’s happening at the moment, we expect sentiment to be affected, ” he said at a briefing. “However, Malaysia is a resilient country with good fundamentals. We will recover but it will take time.”
Wan Hashimi said Sime Darby Property planned to launch RM2.7bil worth of projects this year, adding that it would sell more properties within the affordable and mid-range price points in strategic locations.
“We’re looking at less than 20 projects this year. We have a breadth of products with differing price ranges from affordable to high end.
“But given the current market uncertainty, in light of the Covid-19 outbreak and the political situation, we’re offering more affordable range of products as that’s where most of the demand is right now, ” he said.
Sime Darby Property achieved sales of RM3.1bil in the financial year ended Dec 31,2019, boosted by contributions from City of Elmina, Bandar Bukit Raja, Serenia City, Putra Heights, KL East and Cantara Residences. Total sales had exceeded its target of RM2.3bil by 35%.
In FY19, it launched 2,917 units with a combined gross development value of RM2.3bil. Total unbilled sales were RM1.6bil as at Dec 31,2019.
The group reported an improved net profit of RM598.5mil for the year, mainly due to higher contributions from its core business of property development as well as one-off gains.
Revenue for 2019 rose 30% to RM3.2bil compared with RM2.4bil in the same period a year ago. The group registered a one-off gain of RM245.5mil from the disposal of properties.
Sime Darby Property is the country’s largest property developer in terms of land bank with 19,978 acres of remaining developable land, equivalent to a gross development value of RM86.9bil.
Wan Hashimi said the property sector received a huge boost last year in the form of the Home Ownership Campaign (HOC).
He said Sime Darby Property is hopeful that the government would consider extending the campaign this year.