SP Setia posts record 1Q sales of RM608m

19 March 2010 , By The Edge

S P Setia Bhd's net profit rose 22.5% to RM38.2 million in its first quarter ended Jan 31, 2010 (1QFY10) from RM31.18 million a year earlier, and the strong showing has prompted the property developer to raise its sales target by 25% to RM2 billion for the current fiscal year.

Revenue rose 22.4% to RM363.9 million in 1QFY10 from RM297.1 million a year earlier, mainly derived from its development activities in the Klang Valley, Johor Bahru and Penang.

Basic earnings per share rose to 3.76 sen from 3.07 sen, while net asset per share rose to RM2.04 as at Jan 31 from RM2 at the end of the last financial year.

No dividend was declared for the quarter.

"The group's profit and revenue were mainly derived from its property development activities carried out in the Klang Valley, Johor Bahru and Penang," S P Setia said in a statement released via Bursa Securities on Thursday, March 18.

S P Setia said the group had managed to set a new benchmark with its highest first-quarter sales of RM608 million, a 16% improvement from its previous high achieved in the first quarter of FY08 and almost six times the amount recorded in the previous corresponding period of RM102 million.

"On the back of the strong performance, management has increased the group's FY10 sales target by 25% to RM2 billion," it said.

S P Setia said as at Feb 28, 2010, the group's sales for the first four months of the financial year totalled RM760 million.

It said the group would continue to strengthen its core landed residential earnings base through sales of existing and new launches.

S P Setia said in its new market segments, it had also managed to capture the spillover demand from the successful launch of the initial phases of Setia Sky Residences and Setia Walk.

It said its management's focus in FY10 would also go towards obtaining the necessary approvals in preparation of launch of its recently secured landbank both locally and internationally — particularly projects that offered key strategic positioning that would translate into strong earnings catalyst over the mid-to-long term.

Major ongoing projects under the group include Setia Alam and Setia Eco-Park in Shah Alam, Setia Walk in Pusat Bandar Puchong, Setia Sky Residences in Jalan Tun Razak, Bukit Indah, Setia Indah, Setia Tropika and Setia Eco Gardens in Johor Bahru and Setia Pearl Island in Penang.

Apart from property development, the group's CONSTRUCTION and wood-based manufacturing activities also contributed to the earnings.