S P Setia president and chief executive officer Datuk Choong Kai Wai.
PETALING JAYA: S P Setia Bhd reported a net profit of RM404mil for the six-month period ended June 30, 2024 (1H24) – an increase from last year’s earnings of RM121mil.
The property developer gained RM361mil profit from strategic monetisation of its land bank in Taman Pelangi Indah 2, Johor and Glengowrie, Semenyih.
Revenue in 1H24 rose to RM2.97bil from RM1.9bil in the previous corresponding period last year.
In a statement yesterday, S P Setia said the completion of the land deals marked a strong financial milestone for the group.
For the second quarter ended June 30, 2024 (2Q24) , the group concluded the disposal of its 50% equity stake in Retro Highland Sdn Bhd to MMC Land Sdn Bhd pertaining to Taman Ikan Emas, Cheras redevelopment project under the public-private strategic partnership with the Kuala Lumpur City Hall.
“The settlement was via a full cash consideration, which resulted in a RM56mil profit for the group during the period.”
S P Setia said the total land and development sales achieved for year-to-date 2Q24 was RM2.3bil, surpassing more than 50% the group’s financial year 2024 (FY24) target of RM4.4bil.
“Local projects contributed 96% of the group’s development sales, with the central region dominating the development sales (60%) mainly from Setia Alaman Industrial Park’s contribution.
“In Johor, the southern region’s robust sales performance accounts for 35% of the group’s development sales, with further growth potential expected from the Rapid Transit System Link infrastructure development and Special Economic Zone establishment towards the later part of the year.”
S P Setia president and chief executive officer Datuk Choong Kai Wai is optimistic about the group’s operations and financial outlook for the rest of the financial year.
“This performance underscores our strategic focus on the Malaysian market, particularly in the southern and central regions,” he said.
Leveraging on the rising market demand for industrial development, Choong said S P Setia would continue to explore feasible investment opportunities and potential strategic partnerships for its land that is currently earmarked for industrial park development, particularly in Setia Alaman and the southern region.
The group is poised to unveil major projects including the first phase of Setia Federal Hill in Jalan Bangsar, Kuala Lumpur with an estimated gross development value of (GDV) RM1.4bil.
Reflecting on the group’s financial health and prospects, Choong said its strategic portfolio management and project launches are setting a strong foundation for sustainable growth.
“We have demonstrated consistency of crucial financial improvements in the past few quarters.
“We shall ramp up our efforts to capitalise on market opportunities and deliver more value to our shareholders in the long run.”
As of June 30, the group has a portfolio of 41 ongoing projects, supported by a robust land bank of 5,261 acres valued at a GDV of RM106.69bil.
Total unbilled sales stand at a notable RM4.16bil.
The group has cemented its presence in Malaysia’s key economic centres, namely the Klang Valley, Johor Baru, Penang, and Sabah.
Moreover, the group has expanded its international footprint, with notable projects in Vietnam, Australia, Singapore, China, the United Kingdom and Japan.
Additionally, S P Setia said it achieved successful de-gearing strategies in 1H24.
“From RM10.1bil borrowings in 4Q23, it has declined significantly by RM700mil within six months to RM9.4bil as of 2Q24.
“Net gearing ratio has consistently strengthened over the past few quarters to 0.41 times per 2Q24, compared with 0.49 times in 4Q23 due to the effectiveness of the group’s debt management and capital allocation strategies.”
S P Setia also said it has seen steady progress of inventories clearance so far this year.
“The company achieved RM244mil reduction of stocks compared with the 4Q23 level, representing a 15% clearance progressively taking place through a concerted effort throughout the group.”
Additionally, in conjunction with the group’s 50th anniversary this year, S P Setia said a series of high-energy sales and marketing campaigns and customer engagement programmes had been launched and some are set to be rolled out in collaboration with the group’s various strategic partners.
These efforts are expected to strengthen the group’s refreshed brand positioning and boost sales.
The group’s refreshed brand narrative, “Shaping Spaces That Shape Us All,” reflects its dedication to not just building structures but continue to shape and inspire communities and individuals to thrive in every aspect of life – live, learn, work, and play.
To mark the occasion, a mega event at Setia City Oval Lawn in its crown jewel township Setia Alam in Shah Alam was held where more than 5,000 people attended.
Guests were treated to an array of activities anchored on its refreshed brand theme.
