Revenue jumped 58.5% to RM1.5 billion from RM942.7 million, mainly contributed by the property development segment.
In a filing with Bursa Malaysia today, it said the property development segment achieved a revenue of RM1.43 billion in Q2 FY2024, up RM555.6 million or 64% from Q2 FY2023, supported by the contribution from land sales in Taman Pelangi Indah 2, Johor.
The land sale revenue amounted to RM564 million in the quarter reviewed from RM86 million in the same period last year.
SP Setia said domestic and international under-construction and completed projects also contributed to the positive results.
Revenue from other operations mainly consists of manufacturing and investment properties such as office towers, retail malls, convention centres and hotels.
“In Q2 FY2024, the group also concluded the disposal of its 50% equity stake in Retro Highland Sdn Bhd to MMC Land Sdn Bhd for the Taman Ikan Emas, Cheras redevelopment project, which resulted in a profit of RM56 million,” it said in a separate statement filed with the exchange.
Meanwhile, for the first six-month period, the company’s net profit rose to RM372.36 million versus RM98.51 million, on the back of higher revenue of RM2.97 billion against RM1.91 billion previously.
Year-to-date, SP Setia’s land and development sales totalled RM2.3 billion, surpassing more than 50% of the group’s FY2024 target of RM4.4 billion.
Local projects contributed about 96% of the development sales, while the central region dominated the development sales at 60% mainly from Setia Alaman Industrial Park.
In Johor, the southern region’s robust sales performance accounts for some 35% of the development sales, with further growth potential expected from the Rapid Transit System Link infrastructure development and the establishment of the Johor Bahru–Singapore Special Economic Zone towards the later part of the year.
“We are optimistic about our operations and financial outlook for the rest of the financial year.
“This performance underscores our strategic focus on the Malaysian market, particularly in the southern and central regions,” said its president and CEO Choong Kai Wai.
The group’s debt has declined significantly by RM700 million within six months to RM9.4 billion as of Q2 FY2024 from RM10.1 billion in the fourth quarter of 2023 (Q4 FY2023).
It noted that the net gearing ratio has consistently strengthened over the past few quarters to 0.41 times in Q2 FY2024 compared to 0.49 times in Q4 FY2023 due to the effectiveness of the group’s debt management and capital allocation strategies.
It also achieved steady progress in inventory clearance, with RM244 million in stock reduction compared to the level in Q4 FY2023, representing a 15% clearance progressively taking place through a concerted effort throughout the group.
At the close of trading, SP Setia’s share price was up by one sen or 0.66% at RM1.52, giving the group a market capitalisation of RM7.39 billion.