PETALING JAYA: Property developer SP Setia Bhd achieved a revenue of RM1.03bil and pre-tax loss of RM58.3mil for the six-month period ended June 30,2020, the loss attributable to a one-off impairment of RM145.9mil on completed inventories.
Nevertheless, the company said in a statement yesterday it secured sales of RM875mil during the same period.
“Local projects contributed RM702mil, which represented approximately 80% of the total sales while the remaining RM173mil or about 20% were contributed largely by international projects such as UNO Melbourne, Sapphire by the Gardens and Marque Residences in Australia as well as Daintree Residence in Singapore.”
On the local front, SP Setia said sales were mainly from the Central region with RM502mil, aided by RM127mil contribution from the Southern region, while the Northern region contributed another RM73mil.
“The total sales secured were also complemented by the concerted effort in clearing inventories where RM179mil worth of inventories were monetised during this period.”
In addition to the sales secured, SP Setia also secured bookings of RM1.42bil as at July 2020, said president and chief executive officer Datuk Khor Chap Jen.
“The main focus will now be on the swift conversion of these bookings into sales. Since the movement control order (MCO) and subsequent recovery MCO were imposed to contain the Covid-19 pandemic, activity in terms of new launches and transactions has generally been slower in the residential market.
“More emphasis was placed on the clearing of inventories and the careful rationalisation of launches, ” he said in the statement.
With the lower overnight policy rate, Khor said buyers would have lower barriers to financing and owning properties with good location, therein incentivising residential purchases.
“As the purchase of property is a relatively safe and sound investment in the medium to longer term and coupled with several initiatives lined up under the National Economy Recovery Plan 2020 (Penjana) to rejuvenate the economy by the government, end-users and investors interests may emerge.”
Looking ahead, Khor said the group expects to pick up and ride on the momentum of the increase in real estate activities spurred by the Penjana initiatives.
“The group continues to perform resiliently in this current financial year backed by an unbilled sales totalling RM9.68bil, which will tide the group over for the next two years.”
Besides focusing on clearing the completed inventories, SP Setia said it will remain prudent with selective new launches, concentrating on the mid-range landed units in established townships to cater to the demand of owner-occupiers.
“The group had also put in place several cost rationalisation initiatives for better operational efficiency for this current financial year. The group is also anchored by 48 on-going projects and an effective remaining land bank of 8,711 acres with a gross development value of RM139.4bil as at June 30,2020.”
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