UEM Sunrise chief executive officer Sufian Abdullah
PETALING JAYA: UEM Sunrise Bhd
believes the reduction in residential overhang is attributed to heightened buying interest, and this is likely to improve new property sales prospects for developers.
For the remainder of the year, the company said it is remaining focused on its 2024 priorities in core activities and property investment, while continually exploring growth opportunities.
In the second quarter ended June 30 (2Q24), UEM Sunrise saw net profit decrease by 23.7% year-on-year (y-o-y) to RM18.8mil, as revenue dropped 43.6% to RM205.2mil.
The property developer said the lower revenue to sales of non-strategic lands in Tapah and Iskandar Puteri, which had significantly contributed to revenue in the prior year's corresponding quarter (2Q23).
“Additionally, 2Q23 also benefited from higher property development revenue from advanced local projects, including Residensi AVA in Kiara Bay, Residensi Astrea in Mont'Kiara, and Serene Heights in Semenyih,” it said.
It reported that higher operating expenses, exacerbated by unfavourable results from joint ventures and associates, also contributed to the lower earnings.
For the year up to June 30 (1H24), UEM Sunrise charted a net earnings of RM27mil, representing a 32.5% y-o-y decline compared to the first half of 2023, as turnover reduced by 28.9% to RM430.2mil.
The smaller revenue was down to lower contributions from local property development projects, said the group, while reduced cost savings and higher operating expenses, resulting from increased headcount as well as elevated selling and distribution expenses to boost sales for ongoing projects, also put a squeeze on profits.
The company reiterated its commitment in delivering a disciplined launch schedule, recently introducing the Senadi Hills Rumah Mampu Biaya Johor-C Development and Aspira LakeHomes Phases 4 and 6, with a gross development value of RM20mil and RM108mil, respectively.
UEM Sunrise revealed its robust short-term liquidity position, with RM1.2bil in cash and bank balances, as net gearing ratio also reduced to 0.43 times, which it said underlines a healthy financial headroom for investment and growth.
Additionally, with unbilled sales of RM2.7bil, it is confident of an assured and steady revenue stream and cash flow visibility for the foreseeable future.
Chief executive officer Sufian Abdullah commented that its first-half financial results highlighted its commitment to delivering sustained revenue and profitability momentum, even in a challenging and dynamic market.
“We are confident in our ability to continue delivering value to our stakeholders while reinforcing our position as a market leader in the sector," he said.
