S P Setia Bhd will begin new projects within Setia Fontaines, an integrated development north of Seberang Perai, Penang, which is benefiting from growth from a nearby 850-acre industrial park.

Setia Fontaines is a 1,691-acre township with a gross development value (GDV) of RM12 billion. It will include commercial development including office space, a trade centre, warehousing, a technological hub, shopping centres, F&B, a convention centre, a hotel, and a leisure area.

Wong Wei Sum, an analyst with Maybank Investment Bank (Maybank IB), said that the company recently visited Setia Fontaines and was informed that the project accounted for 10 per cent of S P Setia’s remaining GDV.

As end-Dec 2021, S P Setia has a remaining landbank of 7,237 acres worth RM122 billion in GDV, spread over Malaysia, London, Singapore, Vietnam, and Australia.

“Setia Fontaines offers a similar eco theme as Setia Eco Park but is more affordably priced like Setia Alam. The catalyst to the project include the industrial park nearby, which could offer employment opportunities and attract new population to the area over the longer term,” she said in the firm’s research report.

She stated in a note that the project, which primarily offers standard landed properties, is anticipated to still have at least 25 to 30 years of development left.

According to Wong, the project has produced stable and increasing sales for S P Setia since its launch in 2018.

The project generated RM157 million in sales (+89 per cent year on year), or 4 per cent of S P Setia’s property sales.

She disclosed that Setia Fontaines’ products are more premium (RM500,000 to RM600,000 per unit), in comparison to nearby competitors like Scientex Bhd’s Tasek Gelugor and Sungai Dua developments, which are priced at RM250,000 to RM280,000 per unit.

“We suspect the premium pricing is due to the Setia brand name and a well-designed development plan. The project’s sizeable land area of about 1,000 acres also signifies S P Setia’s long-term commitment and this somehow has provided confidence to the potential buyers and increased the perceived value of their purchase, we think,” she said.

Wong said that S P Setia will launch the commercial plot with a GDV of RM130 million and 450 units of landed residential properties with a GDV of RM400 million in the third quarter of this year (Q3 2023), after receiving a positive response to the launch of Amansara North in the fourth quarter of 2022.

Amansara North has a GDV of RM296 million and 499 landed residential units. Some 80 per cent of the units have been sold, with an average selling price of RM580,000.

Wong also disclosed S P Setia’s continued focus on reducing its debt level through the sale of non-core landbank assets and strategic joint venture partnerships for some of its projects to reduce the up-front project development expenses.

“Apart from that, cash flow repatriation from its overseas projects will help to lower its debt level,” she said.

PETALING JAYA (Feb 15): In the spirit of Chinese New Year, S P Setia Foundation delivered gift baskets during its visit to the Klang and Coast Chik Sin Thong Old Folks Home in Selangor last week.

The visit, a continuation of the foundation’s ‘Sincerely, Setia’ campaign, was led by the foundation’s management committee member Adelene Wong along with Team Setia who were received by the chairman Ng Tian Peng and committee members of Klang and Coast Chik Sin Thong Old Folks Home.

The gift baskets, containing dry food such as rice, crackers, cooking condiments, instant beverages, and essentials like towels and underpads, were delivered to the 28 residents at the home who are aged from 65 to 93 years.

Along with the gift baskets, festive angpows were also given to each of the senior residents of the home.

“We hope that these gift baskets jointly contributed by the staff of S P Setia will not only help reduce the financial burdens of the home but also uplift the spirit of the senior residents here,” Wong said.

During the visit, members of S P Setia Foundation and Team Setia also joined the senior residents for their daily activity which is planned by the home every week.

This gift basket donation programme is in line with the foundation’s second Object of Trust, which involves providing aid to meet the needs of underprivileged, disabled, poverty-stricken or critically ill Malaysians.

S P Setia Foundation, which was established in 2000, also delivered gift baskets to 36 senior residents at Joy Garden Old Folks Home in Semenyih, Selangor earlier this month.

The foundation aims to help underprivileged communities in Malaysia with the focus on creating positive impact, foster integration and national unity, and cultivating a more caring society.

Under the foundation’s Setia Caring School Programme, it has adopted nine schools in Selangor, Penang and Johor.

The programme, which has been running since 2015 aims to cultivate future leaders who are not only academically successful but also grounded in positive moral values and possessing empathy for all in a multicultural community.

Chinese New Year was made more meaningful for residents of an old folks home in Semenyih, Selangor, who received gift bags.

In its efforts to share festive happiness, S P Setia’s charity arm S P Setia Foundation delivered gift bags to 36 residents of non-profit Joy Garden Old Folks Home.

The gift bags contained toiletries and essential items such as pyjamas, socks, bath towel, face towel, shampoo, shower gel, toilet rolls, instant oat drinks and biscuits.

S P Setia Foundation trustee Dr Azura Mansor said the gift bags were prepared by the foundation as well as members of Team Setia.

Through this programme, the foundation is also supporting the less abled community by purchasing socks made by residents from Lovely Disabled Home in the gift bags.

A special talk for the senior citizens was conducted by physiotherapist Eman Yazid, along with demonstrations of light exercises that help maintain joint health.

Dr Azura, who is also an orthopaedic surgeon, shared some advice on stretching exercises for the elderly to maintain and strengthen bone health.

Datuk Halipah Esa, who is on S P Setia Bhd’s board of directors, presented a token of appreciation to James Yong, who runs the home.

Also at the event were S P Setia group quality management general manager Goh Gek Ling, Setia EcoHill general manager Koh Sooi Meng, S P Setia executive vice-president Datuk Yuslina Mohd Yunus and S P Setia group branding and communications head Adelene Wong.

S P Setia’s new Chinese New Year film, Threads of Joy, encourages people to give new life to their old fabrics and usher in joy and blessings with a simple act of upcycling these fabrics into something auspicious.

Created by SPIN Communications in collaboration with Motionrom, the film was inspired by the fact that most of people’s favourite clothes and fabrics are more than objects. They hold stories from the past. Their colours, patterns and textures can evoke precious memories, creating sentimental connections.

After such a fulfilling ‘useful’ life, these fabrics should be woven into present celebrations to create a richer, more meaningful new year.

S P Setia Head of Group Branding & Communications Adelene Wong  said that the festive film and its inspiration also reflect the rise in upcycling and a renewed appreciation for turning fabric waste into something better.

KUALA LUMPUR (Dec 16): S P Setia Foundation hosted an educational outing for 90 primary school students on Dec 13, 2022.

This is part of the foundation’s campaign to promote the spirit of unity amongst the youth while promoting creativity beyond the classroom.

The 90 students were from SK Semenyih, SJK(C) Kampung Baru Semenyih and SJK(T) Ladang Rinching which are schools adopted under S P Setia Foundation’s Setia Caring School Programme, as well as SK(Asli) Bukit Tampoi, Dengkil.

The outing started off with the children being treated to a local animation movie Mechamato, followed by an educational play session at Toy8 Playground, an experiential playground focused on early intervention for children.

“Through the S P Setia Foundation, we hope to play a role in shaping them to be future leaders who know that within hardship, they live in a country whose people are kind, who care about their wellbeing regardless of skin colour or social status, who gives them opportunities to nurture their intelligence, skills and talents to grow up to be positive contributors to this nation’s advancement and development,” said S P Setia Foundation chairman Datuk Zuraidah Atan who is also a director of S P Setia Bhd.

“The outing today was a great experience for the students as the activities were exciting and stimulating which helped enhance their skills. The movie Mechamato was very inspiring which motivated the students to be innovative.

“Additionally, the play session at Toy8 allowed them to learn different skills from a range of activities such as building a robot, top and yoyo,” said principal of SJK(T) Ladang Rinching, Puan Uma Perumal.

S P Setia Berhad has appointed Dato’ Zuraidah Binti Atan as the chairman of S P Setia Foundation effective 1 December 2022 succeeding the late Tan Sri Dr Wan Mohd Zahid Mohd Noordin.

Dato’ Zuraidah is a veteran of corporate social responsibility activities and is known as someone with a big heart and a strong passion for social welfare.

As the chairman, Dato’ Zuraidah will be helming the Group’s vision to create a positive impact among the country’s communities, and foster national integration and unity towards a more caring society. Currently, an independent non-executive director of S P Setia, she is also the chairman of the developer’s Audit Committee. With an LLB (Hons) from the University of Buckingham, England, and a Certificate in Legal Practice (Malaysia), she is a member of the Malaysian Bar and a practising lawyer under her own legal firm, Chambers of Zuraidah Atan.

Dato’ Zuraidah’s present principal appointments include her position as the chairman of the International Association of Traffic and Safety Sciences (IATSS) Forum (Japan) National Committee in Malaysia, which is an annual ASEAN-Japan Leadership Training programme for young professionals sent to Suzuka City, Japan. She is also the honorary advisor of the National Cancer Society of Malaysia.

KUALA LUMPUR (Dec 1): S P Setia Bhd on Thursday (Dec 1) announced the appointment of Annuar Marzuki Abdul Aziz (pictured) as its new chief financial officer (CFO) effective Dec 1.

He replaced Datuk Yuslina Mohd Yunus, 55, who had held the post as acting CFO since May 9.

Prior to holding the CFO position at S P Setia, Annuar Marzuki, 52, was CFO and chief investment officer of KLCC Property Holdings Bhd.

He also had stints as UEM Group Bhd group CFO from September 2009 to August 2013 and PLUS Expressway Bhd CFO between June 2006 and August 2009.

S P Setia’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.

The property developer secured total sales of RM2.7 billion in the cumulative nine months ended Sept 30, 2022, mainly from local projects, which contributed RM2.34 billion or about 87% of total sales. The balance RM359 million came from international projects.

S P Setia’s share price settled half a sen or 0.72% higher at 70 sen on Thursday, bringing the group a market capitalisation of RM2.83 billion.

KUALA LUMPUR: S P Setia Bhd could post a stronger set of fourth-quarter (4Q) results, based on the completion of some of its projects.

This is despite the generally cautious outlook for the property sector in the face of rising interest rates.

According to CGS-CIMB Research, S P Setia’s fourth quarter results are expected to come in stronger with the handover of its Australian projects, Sapphire by the Gardens and UNO Melbourne.

“We believe the group is on track to achieve its sales target for the financial year 2022, as the management expects new property sales in the second-half, given its good product mix that is skewed towards landed homes,” the research house said.

CGS-CIMB Research noted that as of the end of September 2022, S P Setia’s total unbilled sales stood at RM8.4bil, compared with RM9.8bil as at the end of September 2021.

“To recap, the group’s planned launches in the financial year 2022 amount to RM4.04bil gross development value (GDV).

“We expect 2022 to 2024’s net gearing to improve on the back of international project handovers and the potential sale of non-strategic land in the near term,” CGS-CIMB Research said.

Hence, Kenanga Research expects S P Setia’s 4Q net profit to be strong at RM135mil once the handover of Sapphire Melbourne is completed in October 2022. Sapphire Melbourne has a GDV of RM1.2bil, it said.

“The contribution from Sapphire will spill over to the financial year 2023 on gradual handovers, while UNO Melbourne, which has a RM1.5bil GDV will also start to contribute upon its completion in 2023.

The research house said it is cutting S P Setia’s financial year 2022 and 2023’s net profit forecasts by 36% and 21%, respectively.

“We remain cautious on S P Setia as the prospects of the property sector seem to be deteriorating further, clouded by eroding affordability due to rising interest rates and elevated input costs, and its near-term performance will continue to be weighed down by high debt servicing obligations and a high-cost structure,” Kenanga Research said.

Kenanga Research said it is reducing its target price to 38 sen from 58 sen after raising its revised net asset value discount to 90% to reflect its elevated debt levels as it has the highest net gearing within its coverage.

The research house also noted that this might potentially lead to liquidity issues in a weaker market environment moving forward.

Meanwhile, UOB Kay Hian (UOBKH) Research is more positive and upgraded S P Setia to a “buy” given its recent share price weakness.

“However, we lower our target price to 82 sen in tandem with the earnings adjustment.

“Our target price is based on a 78% discount to its revised net asset values, which implies 0.2 times 2023’s price to book value,” it said.

“We believe its near-term earnings recovery has been fairly priced in at its current valuation, with a lack of catalysts in 2022 and an interest rate hike as the potential sentiment dampener for the sector,” UOBKH Research added.

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.