Sime Darby Property’s profit surges on asset sale

by MARK RAO / pic by TMR FILE PIX

Sime Darby Property Bhd’s (SDP) net pro t rose exponentially on a one-off gain from the disposal of a Singapore-based property and stronger revenue base.

The property developer recorded a net profit of RM265.07 million for the first quarter ended March 31 this year (1Q19), substantially higher than the RM33.67 million it made in the corresponding quarter last year.

This was largely due to the sale of the Darby Park Executive Suites in Singapore which saw the company recognise a RM203.4 million disposal gain on its books.

Revenue was 2.8% higher year-on-year at RM575.13 million on improved contributions from all three business segments.

The property development business, which makes approximately 93% of total group revenue, bene ted from its Ara Damansara projects which offset lower contributions from the Elmina and Bandar Universiti Pagoh townships.

Share of losses from joint ventures and associates also lessen to RM1.8 million for the period from RM19 million loss in 1Q18 due to its JV project PJ Midtown and

lower losses from the UK-based Battersea Power Station and Sime Darby Sunrise JVs.

The company’s property investment segment returned to black on higher contribution from facility and asset management services, lower operating expenses and higher occupancy achieved at Melawati Mall, Kuala Lumpur.

The developer’s leisure and hospitality business narrowed its losses on the stronger revenue achieved by golf club TPC Kuala Lumpur.

On Battersea, SDP noted in its exchange filing yesterday, the disposal of commercial assets under the second phase of the mixed development frees its equity commitment for the commercial asset development in 2019.

The developer stated the disposal of 300 acres (121 ha) of land in Bukit Selarong, Kedah, allows it to channel additional cash towards development activities and expand its industrial and logistics business.

SDP is Malaysia’s largest property developer in terms of land bank, with the company holding a balance 20,374 acres to be developed.

As of 1Q, total unbilled property sales stood at RM2.1 billion.