Sunway Berhad records higher profits in property and construction segments

Sunway Berhad records higher profits in property and construction segments

Bandar Sunway, 25 November – Sunway Berhad, one of Malaysia’s largest conglomerates with core interests in real estate and construction, today reported a 19.6% increase in revenue to RM1,137.5 million and a higher net profit of RM143.6 million for the current quarter ended 30 September 2016 compared to revenue of RM951.0 million and net profit of RM133.3 million in the corresponding quarter of the previous financial year.

“Given the improved third quarter results, we expect the Group’s performance to remain satisfactory for the remainder of the year as our last quarter performance tends to be our strongest seasonally. While we will proceed with caution in our business strategy due to the current unpredictability of the global economy, we are confident to meet the challenges ahead as we have the advantage of a diversified business portfolio,” said Chong Chang Choong, CFO of Sunway Berhad.

Sunway Berhad continues to maintain a strong balance sheet and low-gearing of 0.38 times.

STRONGER PERFORMANCE OVERALL

The property development segment reported a commendable 61.6% increase in profit before tax to RM62.2 million in the current quarter from RM 38.5 million in the corresponding quarter of the previous financial year despite lower revenue at RM 247.6 million compared to RM 270.9 million in the corresponding quarter of the previous financial year.

The higher profit before tax was contributed mainly by higher progress billings from local projects and other property projects in Singapore. Lower revenue was due to lower contributions from the Group’s wholly-owned Avant Parc project in Singapore which commenced revenue recognition in the corresponding quarter of the previous financial year and was fully sold in the second quarter of this year.

Property sales year to date stands at RM 864 million compared to property sales year-to-date of RM 734 million in the previous year. Unbilled property sales remain healthy at RM1.8 billion, providing good earnings visibility for the property division.

The property investment segment also reported higher profit before tax of RM45.9 million compared to RM37.3 million in the corresponding quarter of the previous financial year. Third quarter revenue is also higher at RM189.9 million compared to revenue of RM172.2 million in the previous year. The better performance is due to better occupancy from Sunway’s portfolio of investment properties and an increase in the number of visitors to Sunway Lagoon and Lost World of Tambun following the opening of several new attractions, which include the Nickelodeon Lost Lagoon opened in February 2016.

The construction segment recorded revenue of RM287.9 million and profit before tax of RM32.2 million in the current quarter compared to revenue of RM196.8 million and profit before tax of RM24.1 million in the corresponding quarter of the previous financial year. Revenue in the current quarter was higher due to lower intra-group eliminations. Current profit before tax was also higher due to higher progress billings from local construction projects.

The construction order book remains healthy at RM 4.8 billion with a year-to-date order book replenishment of RM 2.6 billion.

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