1 June, KUALA LUMPUR – As part of its on-going transformation journey and business continuity plans, Mah Sing Group Berhad is strengthening its digitalisation initiatives by accelerating capabilities to market products digitally amid the current challenging market environment due to the COVID-19 pandemic. The Group will also continue to look out for prime lands in the Klang Valley area as it announces a healthy balance sheet with cash and bank balances of approximately RM1.05billion for the quarter ended 31 March 2020.
Digitisation Capabilities key part of Mah Sing’s Business Continuity Plans amid COVID-19
Mah Sing’s Founder and Group Managing Director, Tan Sri Dato’ Sri Leong Hoy Kum said, “We have been proactively introducing various digitalisation initiatives across all aspects of our business such as sales, project, customer service; and upskilling our staff through company-wide, nation-wide retraining and roll-out of Microsoft Teams.”
The Group’s digitisation capabilities are key to its Business Continuity Plan (BCP) which was activated to mitigate the effects of the COVID-19 pandemic. It pre-emptively initiated the roll-out of collaboration tools to ensure seamless communication and business processes. During the Movement Control Order (MCO) period, the Group was able to have a smooth migration of its full workforce to remote working. 100% of Client-Consultation-Meetings are held online.
Key parts of its digitalised sales processes were successfully integrated, from launching virtual show units on its official website, boosting of more digital campaigns, conducting online bookings and payments, as well as adding incentives for sales conversion since the early days of MCO. The Group also commence a full set up of remote customer careline. All these efforts have minimised the impact on the Group’s operations.
“We have increased our digitalisation efforts to reach out to buyers during MCO, as this is the way moving forward for the entire industry. Currently, the Group’s eligible construction sites which have met the requirements and standard operating procedure (SOP) set during the conditional movement control order (CMCO) period have gradually resumed operations. Strict SOP especially with regards to hygiene and sanitation for offices premises, sales galleries and construction sites have also been set up and followed. These measures will lessen the impact of MCO and allow us to catch up on work progress in the office and on-site,” said Tan Sri Dato’ Sri Leong Hoy Kum.
In addition, the Group has implemented several cost savings and rationalisation measures. This includes temporarily freezing staff recruitment whilst still maintaining an effective operational structure. As this is a continually evolving situation, the Group will continue to monitor and implement further appropriate measures if required.
Healthy Balance Sheet For More Landbanking
With disciplined financial management and a healthy balance sheet with cash and bank balances at approximately RM1.05billion as at 31 March 2020, Mah Sing will maintain selective balance sheet expansion by focusing on strategic land banks which are suitable for affordable products in Greater Kuala Lumpur, Klang Valley and Johor.
“Market demand for affordable houses is expected to remain resilient as the majority of our young population are not yet house owners. We believe that properties to be the preferred investment asset class to build and preserve wealth. Armed with strategically located landbanks, we will continue to focus on well-designed products with attractive price points in line with the market demand,” Tan Sri Dato’ Sri Leong Hoy Kum elaborated.
Mah Sing revealed this as they announced a profit before tax of approximately RM43.1million on the back of revenue of approximately RM371.1million for the first quarter ended 31 March 2020. The Group achieved property sales of approximately RM247.4million for the period ended 31 March 2020.
The development projects, which contributed mainly to the Group’s results include M Vertica in Cheras; M Centura in Sentul; Southville City in KL South, Southbay City in Penang; Meridin East and Sierra Perdana in Johor. Other projects which also contributed include M Oscar off Kuchai Lama; Lakeville Residence in Jalan Kuching; D’sara Sentral in Sungai Buloh; M Aruna in Rawang; Ferringhi Residence 2 in Penang; Meridin @ Medini and Mah Sing i-Parc in Johor.
Revenue from property development was approximately RM281.3million while operating profit was approximately RM36.7million for the quarter ended 31 March 2020. This was due to traditionally softer demand during the Chinese New Year festive season as well as delayed construction progress due to the MCO. Weaker buyer sentiments and the closures of construction sites and sales offices due to the imposition of MCO in response to COVID-19 pandemic on 18 March 2020 further weighed on sales conversion and rate of works
The plastics segment continued to contribute positively to Group performance and recorded revenue of approximately RM76.1million and operating profit was approximately RM3.34million for the quarter ended 31 March 2020.
Planned new launches for the remainder of 2020 include M Adora in Wangsa Melawati, M Luna in Kepong, Carya in M Aruna, Rawang, remaining blocks of M Vertica in Cheras, Ferringhi Residence 2 in Penang and Acacia, Jasmine link homes in Meridin East, Johor.
“We also continue to introduce innovative marketing campaigns to enhance the buyers’ home ownership journey. In February, we launched our latest Eazy to Own Campaign in February – aimed at enabling homebuyers to own their dream home with a financing plan that is easy on their wallet, whilst addressing their pain points. We also collaborated with Maybank Islamic to offer HouzKEY, an innovative home financing solution, which enhances our Eazy to Own campaign. In line with our tagline, “Reinvent Spaces. Enhance Life,” we remain committed to developing product offerings that fit the needs and want of buyers today,” Tan Sri Dato’ Sri Leong Hoy Kum added.
RM1.6billion Target Sales For 2020 With 84% Of Products Priced Below RM700,000
The Group has set an RM1.6 billion sales target for 2020 with 84% of products priced below RM700,000. While the market is challenging, the Group is cautiously optimistic that demand for their property projects will obtain buyers’ interest, driven by strategic location, attractive price points coupled with attractive packages, innovative design and layout.
As at 31 March 2020, the Group has remaining landbank of 2,019 acres with remaining gross development value and unbilled sales totalling approximately RM24.86billion.
Tan Sri Dato’ Sri Leong Hoy Kum said, “The market environment is expected to remain challenging for the year due to the uncertainties posed by Covid-19 pandemic and we have successfully rolled out our Business Continuity Plan to manage any potential operational disruptions. We are concurrently implementing cost savings and a temporary hiring freeze. The stimulus measures announced by the Government will assist households and businesses, and the attractive interest rate environment due to multiple rounds of Overnight Policy Rate reduction serve to make home ownership more affordable. The reduction of Statutory Reserve Requirement will maintain sufficient liquidity in the domestic financial system and may spur lending.”