Strong future growth prospects for Sime Darby Property

Sime Darby Property Berhad’s future growth prospects remain strong having achieved total bookings of RM1.1 billion as at October 31, 2020, owing to the national Home Ownership Campaign (HOC) that was reintroduced in June 2020.

The developer said that take-up rates have been encouraging, with launches of residential homes such as Elmina Green Three and Serenia Ariya achieving full take-up on the launch weekend.

“I am pleased to report that within the nine-month period, we have achieved a total sales of RM1.3 billion and am confident to exceed our revised annual sales target of RM1.4 billion,” said Sime Darby Property group managing director Datuk Azmir Merican in a statement.

Azmir said the group’s resilient financial position and revenue visibility, supported by a moderate net gearing level of 0.26 times and unbilled sales of RM1.5 billion, puts it in good stead to ride out market uncertainties.

Acknowledging the on-going Covid-19 pandemic, Azmir said Sime Darby Property has initiated the process of proactively assessing the value of its assets to ensure prudent measures are in place to reflect the evolving market conditions.

“Given the uncertainty with respect to the pandemic and its related economic consequences, assessments will continue to be made to ensure the group will be on a stronger footing as the overall economic environment gradually recovers,” he said.

Sime Darby Property posted revenue of RM592.6 million for the third quarter, an increase of 105.6 per cent compared to the preceding quarter, and RM1.36 billion for the nine months ended September 30, 2020.

However, it recorded a loss of RM358.6 million for the third quarter and RM456 million for the nine-month period under review, mainly due to impairment of inventories at the Battersea Power Station project in London and the property development segment.

The group’s quarterly result was impacted by the share of impairment loss of RM337.1 million (GBP62.4 million) from Battersea Project Holding Company Limited and its subsidiaries, a 40 per cent-owned joint venture of Sime Darby Property, in respect of the Battersea project, and the impairment of inventories of RM97.8 million.

The said impairment from the Battersea project was due to the challenges presented by the Covid-19 pandemic in the United Kingdom which had an impact on the delivery of the project.

Azmir said notwithstanding the impact of Covid-19 on the global market, the Battersea project continues to maintain good momentum with respect to both residential sales and commercial leasing where agreements for leases have been entered into with leading brands.

Source: NST