Up 153%, even with the slowdown. SP Setia.

Yes, all of us have heard about the slowdown nearly everyday. No one really understood the term slowdown meant here is still growth. Many thought it’s already recession in Malaysia. Well, one company has showed resilience thus far. SP Setia Bhd’s earnings surged 153% to RM267.78million for Q3 2015 versus a year ago due to its Australian venture. Revenue is up 81.2% to RM1.634 Billion from RM902.66 million. A simple calculation showed a net margin of 16 percent. Indeed still a very healthy number! SP Setia said that the achievement was due to increased revenue and profit recognition from its strong sales pipeline and the handover of second and final residential tower of Fulton Lane in Australia.
SP Setia has unfilled sales of RM9.9 billion which meant that it will continue to perform well in the remaining financial year. According to SP Setia acting president & CEO Datuk Khor Chap Jen, it’s venture into the Australian market has been good with the current challenging property market. It will continue to seek new ventures in Australia as it continues its overseas portfolios. The next project to be handed over is also overseas, in Singapore. The project is 18 Woodsville and it has obtained the temporary occupation permit (TOP) two months ahead of schedule. Main challenge for 2015 is similar to that echoed by many other developers thus far, the volatility of the market, cooling measures imposed by the government and the tougher loan approval measures from the banks.
Slowdown meant whatever was planned earlier would determine if a developer continues to prosper. SP Setia, despite losing many huge names still have many ongoing projects which should sustain it continuously. I seriously believe however that moving forward, a more ‘affordable’ stance would be necessary even if it continues to have overseas exposure which can help in the current slowdown with the domestic property market. Already some have reduced their yearly targets even if the total sales remain huge and still continuing. Read here: Mah Sing scaling back, revising target downwards. Let’s hope more good results are coming and continuous. Happy scouting for good deals.
written on 10 Sept 2015
Next suggested article: SP Setia wins Malaysian developer of the year: SEAPA 2015