S P Setia's profit slips 8.9% for quarter ended Oct 31

by **Cals** Thu 10 Dec 2015, 22:36

S P Setia's profit slips 8.9% for quarter ended Oct 31

By Yimie Yong / theedgemarkets.com | December 10, 2015 : 9:19 PM MYT

KUALA LUMPUR (Dec 10): Property developer [size=16]S P Setia Bhd ([You must be registered and logged in to see this image.] Valuation: 2.00, Fundamental: 1.90) posted a net profit of RM119.68 million in the three months period ended Oct 31, 2015, a decline of 8.9% from RM131.31 million a year ago, due mainly to higher selling and marketing expenses.

Thus, earnings per share (EPS) fell to 4.58 sen, from 5.19 sen, its filing to Bursa Malaysia today showed.

Revenue, however, was 14.7% higher at RM1.41 billion, from RM1.23 billion, on the back of increased revenue and profit recognition from the development of strong sales pipeline to date, and timely-staged handovers of the group’s Australian project, Fulton Lane.

For the 12 months period ended Oct 31 (12MFY15), S P Setia’s net profit jumped 75% to RM709.98 million or 27.66 sen per share, from RM405.68 million or 16.3 sen per share, as revenue rose 47.1% to RM5.61 billion, from RM3.81 billion a year ago.

“Despite the challenging market, we have fared reasonably well. We have been strategic in our launches this year, to suit market demand, while continuing to deliver on our promises of quality, innovation and reliable products and services. We are confident [that] the group is on track to achieve our RM4 billion sales target by December 2015,” said S P Setia's acting president and chief executive officer, Datuk Khor Chap Jen.

Total group sales for the 12 months period ended Oct 31 came in at RM3.45 billion; Malaysian projects contributed RM2.2 billion (64%) towards its total sales.

Its sales for the fourth quarter alone stood at RM911 million, from which local projects contributed 83% or RM754 million.

The group will have two more months before ending its current financial year, after changing its financial year end from Oct 31 to Dec 31.

S P Setia noted that the local property industry continues to face challenges due to current economic uncertainties, with a weaker ringgit, lower oil price, rising costs of living after the implementation of the goods and services tax (GST), and tighter lending from banks.

All these have contributed to the overall weak market sentiments, the property developer said.

Nevertheless, with unbilled sales of RM9.5 billion, S P Setia is confident it will continue to perform well in the remaining two months of the financial period, considering the group’s strong brand name, established townships and right product strategies.

S P Setia has changed its financial year end to Dec 31, from Oct 31. The current financial statements of the company shall be for a period of 14 months, made up from Nov 1, 2014 to 31 Dec 31, 2015.

S P Setia closed 3 sen or 0.96% lower at RM3.10 today, for a market capitalisation of RM8.15 billion.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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