S P Setia's 3Q profit surges over six times to RM70 mil, driven by southern projects

KUALA LUMPUR (Nov 17): S P Setia Bhd’s net profit surged more than six times to RM70.18 million in the third quarter ended Sept 30, 2022 (3QFY2022) from RM11.01 million in 3QFY2021, underpinned by higher contribution from its property development business.

Group revenue grew 44.8% to RM860.94 million from RM594.55 million, its bourse filing showed. No dividend was declared.

Profit before tax from its property development business jumped 82.66% to RM131.07 million from RM71.76 million, as revenue expanded to RM809.95 million from RM546.96 million, thanks to stronger contribution from its southern region's commercial projects.

Loss before tax (LBT) for its construction business, which largely provides intercompany construction services to the group's property development companies, narrowed to RM3.3 million from RM8.95 million, as revenue rose to RM3.94 million from RM2.63 million.

Other operations remained loss making, with an LBT of RM11.12 million versus RM10.53 million previously, even though revenue rose 74.52% to RM47.05 million from RM26.96 million.

For the cumulative nine months ended Sept 30, 2022 (9MFY2022), S P Setia's net profit grew 35.22% to RM217.78 million from RM161.05 million in 9MFY2021, as revenue rose to RM2.75 billion from RM2.73 billion.

S P Setia achieves RM2.7 bil sales in first nine months of 2022

In a separate statement, S P Setia said it secured total sales of RM2.7 billion in 9MFY2022 mainly from local projects, which contributed RM2.34 billion or about 87% of total sales; the balance RM359 million came from international projects.

SP Setia President-cum-Chief Executive Officer Datuk Choong Kai Wai said RM478 million of completed inventories were sold and RM592 million of bookings were secured as at Sept 30, 2022.

“The group's local projects progress is envisaged to be improved by the fourth quarter of this year despite the recent acute labour shortages faced by the real estate industry," Choong said.

"Our developments in Australia are progressing well — Sapphire by the Gardens was delivered to homebuyers last month, whilst UNO Melbourne is slated for partial completion by this year-end. Hence, we expect revenue from Australia to contribute significantly to our final quarter of FY2022," he added.

Choong said the group is set to achieve its sales target of RM4 billion set for FY2022 backed by unbilled sales totalling RM8.4 billion, which will provide earnings visibility to the group in the short to mid term.

S P Setia is currently anchored by 47 ongoing projects and an effective remaining land bank of 6,687 acres, with a gross development value of RM119.47 billion as at Sept 30, 2022.

S P Setia shares closed 0.5 sen or 0.95% higher at 53 sen on Thursday, giving it a market capitalisation of RM2.16 billion.

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