KUALA LUMPUR: SP Setia Bhd's second quarter net profit ended June 30, 2023 nearly halved on lower contributions from the property development business and higher losses from the construction business.
Net profit was down to RM43.1 million for the quarter, from RM80.1 million for the corresponding quarter in 2022.
According to a filing with Bursa Securities the property development business saw lower contribution from the Singapore and Central region; higher financing cost from hikes in interest rate; unfavourable foreign exchange movement and higher share of losses from joint ventures.
This was on eight per cent lower revenue of RM942.7 million for the quarter, compared with RM1.02 billion in the same quarter in 2022.
In a separate statement, SP Setia said with 44 ongoing projects and unbilled sales amounting to RM6.82 billion as of June 30, 2023, the group's earnings visibility in the short to mid-term is robust.
"Despite the global challenges posed by persistent inflation and higher interest rates, the group remains optimistic about achieving a noteworthy performance for the financial year 2023. Through the group's disciplined debt reduction programme and de-gearing roadmap implementation across all its business units, the net gearing level of the group has been reduced to 0.55x and is expected to improve further progressively
Net profit for the six month period ended June 30, 2023 was down to RM98.5 million, compared with RM147.6 million for the same period in 2022.
Revenue for the six month period however, was slightly higher at RM1.9 billion compared with RM1.88 billion in 2022.