Mah Sing earnings up 16% to RM69.4mil, positive on prospects

Nadya Ngui


PETALING JAYA: Mah Sing Group Bhd
posted a 16% increase for its 1Q13 earnings to RM69.4 million from
RM59.9 million a year ago due to strong contributions from its property
product mix and profit recognition from properties handed over.
Its
revenue however fell 7.6% to RM423.1 million from RM457.7 million a
year go due to contribution from mostly high rise projects that were at
early stage of construction.
Earnings per share were higher at 7.89sen vs 7.20sen a year ago.
The
property group said it achieved sales of RM749.6 million during its
first quarter and is on track to achieve its 2013 full year sales target
of RM3 billion, adding that it has strong earnings visibility with
unbilled sales of RM3.55 billion, or 2.28 times the revenue recognized
from the property development division in 2012. Mah Sing said its
plastics segment continued to contribute positively to the group however
it was affected by staff costing. “While revenue grew by 18% to RM58.8
million, profit margin was affected by foreign exchange difference and
higher staff costs as a result of minimum wage ruling in Indonesia,” it
said. The firm noted it further strengthens its balance sheets with the
successful completion of the rights issue with warrants that raised
approximately RM397 million during the quarter. It had also recently
purchased two lands plus enhancements to Southville City@KL South --
which is expected to yield a combined gross development value (GDV) of
RM7 billion.
“With these new lands, the group has 43 projects
with approximately RM26.4 billion remaining GDV and unbilled sales. This
provides significant earnings visibility of 7 to 8 years,” it said.
“In the immediate term, the group will focus its growth and continue to
expand its land bank in the four markets that it knows well and has
proven track record like Klang Valley, Iskandar Malaysia in Johor Bahru,
Penang and Kota Kinabalu, Sabah,” it said.