President and CEO Tan Sri Liew Kee Sin was confident the group would meet its 2011 financial year target of RM3bil in sales and said in a statement that SP Setia was going ahead with plans to launch property projects on its newly acquired land in Cyberjaya, Johor Baru and Semenyih.
“Our sales have never been higher and our balance sheet has never been stronger. All our existing projects are performing well and very shortly we will have several new projects onstream to further strengthen our sales pipeline,” Liew said.
“Our strong branding, breadth and depth of product range as well as geographical reach in all the key economic regions of the Klang Valley, Johor Baru and Penang place the group in good stead to continue to capture the solid underlying demand for good properties in Malaysia,” he said.
The property giant posted a net profit of RM91.2mil for the quarter on RM583.5mil in sales. For the nine months of its current financial year ended July 31, the company's net profit totalled RM245.5mil with revenue hitting RM1.6bil.
Liew also said the group had not forgotten the starter home market, a space where it built its name on.
“We recently acquired a 1,011-acre parcel in Daerah Ulu Langat, Semenyih where we intend to start off by building affordable homes for first-time homeowners.
“We built our name on township development and it is a market segment that we love due to its strong counter-cyclical nature and the many opportunities for us to create value. We are excited about this project because it enables us to venture into a new and growing development corridor to capture fresh market share,” he said.
SP Setia will be showcasing its range of properties to prospective buyers at the three big economic centres of the country. Called the Setia 4U Showcase, the exhibition kicked off in Gurney Plaza Penang yesterday and will go on until Sept 25. It then moves to PWTC Kuala Lumpur from Sept 30 until Oct 2 and City Square Johor Baru between Oct 7 and Oct 9.
On Friday Bernama reported that the global economic uncertainty, which has dampened property buyers' sentiment, might be the stumbling block for SP Setia Bhd to achieve its target sales of RM3 billion this year.
In a note Friday, ECM Libra Investment Research said the property developer would face a slowdown on property sales should external uncertainties derail economic growth.
"However, estimated current unbilled sales of RM2.7 billion should underpin near-term earnings visibility," it said.
Hong Leong Investment Bank Research said apart from the slowdown in sales, escalation in construction and raw material costs as well as delay in launches were among other risks faced by the company.
"The 10-month sales clocked in at RM2.3 billion, or RM2.8 billion on an annualised basis, suggest that SP Setia could fall slightly short of its stated RM3 billion sales target for financial year 2011," it said in a note.
ECM Libra and Hong Leong Investment had maintained "hold" calls on the company.
Hong Leong Investment maintained its target price (TP) of RM4.12 but ECM Libra lowered its TP to RM3.20 from RM4 previously.
By The Star
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