SP Setia confident of achieving RM4 billion sales target for FY16


SP Setia confident of achieving RM4 billion sales target for FY16

KUALA LUMPUR, Feb 26: SP Setia Bhd is confident of achieving its RM4 billion sales target for the financial year ending Dec 31, 2016 (FY16), driven by RM4.7 billion worth of launches this year.

Acting president and CEO Datuk Khor Chap Jen said it is launching some 8,000 units worth RM4.7 billion this year. The launches are a mix of affordable housing, mid-range housing in its existing townships and condominiums in selected projects.

“This year, I think the first half will be soft but we think the market will pick up in the second half. We think sentiment will improve in the second half,” he told reporters at a results briefing yesterday.

He said there is strong demand for affordable apartments and mid-range housing while condominiums will be launched in areas that are underserved.

In addition, its unbilled sales of RM9.2 billion (as at Dec 31, 2015) will be delivered over the next two to three years, providing profit visibility to the group.

Khor said 80% of sales this year will come from local projects.

“The remaining 20% will be from overseas projects because for our Australian projects, they are all sold out. There’s nothing left to sell and we have one new Australian project which is small in size,” he said, adding that it is still on the lookout for new sites in Australia.

“In London, we are not launching anything new this year because part of the land has been surrendered for the construction of the Northern Line. So we have to wait for them to complete and handover the land to us. That’s why we are targeting 80% from local this year and 20% from overseas,” he said.

For the 14 months ended Dec 31, 2015 overseas projects contributed 33% to sales. For the financial year ended Oct 31, 2014 (FY14) overseas projects contributed 39% to sales. The group recently changed its financial year end from Oct 31 to Dec 31.

“Last year was a real challenging year for the property sector. This year it will be a challenging year again but it will give us the opportunity to acquire landbank.

“We are looking at opportunities mostly in the Klang Valley and Johor but if any good landbank comes up north in Penang, we are still open. Overseas, we will be focusing on the Australia market,” said Khor.

For the 14 months ended Dec 31, 2015, the group posted a net profit of RM918 million compared with RM388 million in FY14. Revenue last year was at RM6.7 billion compared with RM3.8 billion in FY14.

Khor said it achieved RM4.3 billion in sales last year, exceeding its RM4 billion target despite difficult market conditions.

The group declared a record high dividend of 19 sen per share, subject to shareholders’ approval.

If approved, full year dividends payout will be 23 sen per share, which includes the interim dividend of 4 sen per share totalling RM604.5 million, representing a dividend payout ratio of 65.8% of net profit.

Sign up and stay updated
Get the latest property news, home solution tips, interior design ideas and property guides.
By subscribing, you consent to receive direct marketing from iProperty.com Malaysia Sdn Bhd (iProperty), its group of companies and partners. You also accept iProperty’s Terms of Use and Privacy Policy including its collection, use, disclosure, processing, storage and handling of your personal information.