Sime Darby Property expects property demand to moderate during the first quarter of 2022, assuming the government decide not to further extend the Home Ownership Campaign (HOC), which is set to end on 31 December 2021.
Nevertheless, Sime Darby Property’s Group Managing Director Datuk Azmir Merican sees the market gradually improving over the next quarters, reported The New Straits Times (NST).
“The HOC has been very helpful…(but) there is no HOC next year. Over the long term, we remain optimistic for Sime Darby Property. We have new industrial products that are quite healthy, and we know that demand for landed homes will continue to be strong,” he said as quoted by NST.
“We need to gauge the market as we launch and plan integrated products to arrive at the right places in our township at the right price.”
The company is planning to launch 1,856 units, with a gross development value (GDV) of RM1.6 billion, in the fourth quarter of this year.
Of these, 57.8% will be landed housing units worth RM921 million, 25.8% (worth RM411 million) industrial products, and 13.9% (worth RM222 million) high-rise residential units.
The total value of the company’s launches for the fiscal year 2021 stands at RM3.9 billion, while total sales is expected to exceed RM2.4 billion.
Azmir shared that Sime Darby Property has achieved 80% (RM1.9 billion) of its sales target.
The company expects a surge in property transactions before the end of HOC next month, coupled with the low interest rate environment.
“We are very positive of exceeding the sales target and having the digital capabilities in executing sales online. I think consumers find it easy to transact for our products that they know and understand,” he said during the release of the company’s results for Q3 FY2021.
Sime Darby Property saw its revenue drop 34.49% to RM388.24 million in Q3 FY2021 from RM592.63 million over the same period last year.
Despite the drop in revenue, the company’s net loss significantly shrank from RM359.97 million in the previous year to RM15.8 million as its joint ventures registered lower losses.
For the nine months ended 30 September 2021, Sime Darby Property returned to profitability, posting a net profit of RM64.72 million versus a net loss of RM450.24 million in the previous year.
The company underscored that its financial position continues to be strong, with RM618.9 million cash balance and an average net gearing ratio of 32.1% as of Q3 FY2021.
It also has increased its future revenue visibility, with unbilled sales to date at RM2.1 billion, surpassing the RM2 billion mark for the first time since 2018.
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