Latest news with #RM4bil
The Star
7 days ago
- Business
- The Star
SimeProp bullish on 2025 after strong 1Q
PETALING JAYA: While keeping a positive outlook for 2025, Sime Darby Property Bhd (SimeProp) remains cautious towards the degree of worldwide volatility beyond this year, especially emanating from the trade tariff situation, and is concerned about its wider impact. Group managing director and chief executive Datuk Azmir Merican remarked that volatility is 'never a good situation', before saying that it is helpful to understand how finalised tariff decisions can affect all parties involved, since Malaysia has substantial business relations with the United States, China and Asean. 'That said, we are rather optimistic for 2025, but it is when we look towards 2026 and beyond, we wonder whether future launches and lending will be affected, not as a primary impact on our properties but as part of a secondary round of impact,' he told a virtual media briefing yesterday following the release of its first quarter of financial year 2025 (1Q25) results. He acknowledged that SimeProp, being a property developer, is highly dependent on the overall economy doing well, which in turn influences investor confidence. Nevertheless, Azmir reiterated the group's bright prospects for the near and medium term, especially throughout 2025. Despite recording a marginally lower net profit year-on-year (y-o-y) of RM118.4mil for 1Q25 as compared to the corresponding period a year ago, Azmir emphasised that 1Q24 was the group's strongest quarter thus far, and the result from 1Q25 was therefore encouraging. This was underpinned by the fact that net profit margin had improved from 12.6% to 13.6% y-o-y in 1Q25. He pointed out that 1Q25 profitability was supported by a turnaround in the investment and asset management segment, coupled with profit from compulsory land acquisition, which offset the lower segment results from the property development segment and leisure division. Having launched a total gross development value (GDV) of RM656.5mil in 1Q25, from a goal of RM4bil GDV to be put in place this year, Azmir said SimeProp will launch the remaining GDV of RM3.3bil across the industrial, residential and commercial segments, with respective shares of 30%, 59% and 11%. The group has a sales target of RM3.6bil for 2025. Of interest, industrial products contributed to half of the RM927.5mil sales figure achieved by the group in 1Q25, with residential high rise products contributing in total 27% of sales, while residential landed properties made up 16%. Commercial products, meanwhile, contributed to 7% of sales, driven by sustained demand across our maturing townships. Azmir observed that sales remained concentrated within central and Greater Klang Valley, with a notable increase in contribution of 20% from Negri Sembilan. Explaining the relatively larger share of sales contribution from the group's industrial segment, chief operating officer for township development Apollo Leong said in the second half of 2024, SimeProp launched nine phases of industrial properties, compared to only three phases of landed residential developments. 'The big jump in sales contribution by industrial properties is due to the timing of their recognition, although we do have a heavy pipeline of industrial properties as well,' he said. As such, Azmir maintained that residential properties would catch up to industrial products with regards to sales contribution, although with the group also focusing on industrial launches, he is expecting the latter segment to yield more than a 30% share in sales by end of 2025. Meanwhile, commenting on its Battersea Power Station (BPS) project, he said the take-up rate for the residential component of Phase 3B (Electric Boulevard) had increased to 74%, representing a 6% quarter-on-quarter growth, while the office leasing rate remained at 45%. He noted that footfall at BPS also grew a healthy 8% y-o-y in 1Q25, before remarking that since its opening in October 2022, the location has welcomed over 30 million visitors. 'More importantly, we have secured detailed planning approval and consent from Wandsworth Council for Phase 3C of BPS, comprising a mix of residential, retail, community and leisure development, with anticipated completion in 2029,' said Azmir. Elaborating on the group's strategy for BPS going forward, he said leasing enquiries for the office building has been strong, and rental rates have been encouraging. However, he said SimeProp is more keen to take in tenants for longer tenures, with the aim that they can commit for up to 10 years. 'Since we have leased out almost half the building, and because securing long tenancies remains our goal, we are now selective with our prospective tenants. 'We would prefer they commit for the long term, because then we can have an idea of how they can provide stabilised rental income for the group,' said Azmir. On the other hand, he said rental rates in the United Kingdom have shot up faster than expected, which has become a double-edged sword, because while this means there is a higher likelihood that tenants will be able to pay rental rates above the group's projections, it could also represent the fact that it may take a longer time for space to be taken up. For the rest of 2025, Azmir reported that the company is guiding for a gross profit margin of 20% to 25%, and a debt-to-equity ratio of less than 0.5 times by balancing active working capital and investments for future growth. It is also aiming to ensure optimal asset turnover by maintaining at most 10% of completed stocks. 'We see strong growth from the property development segment across 26 townships, driven by a well-diversified mix of residential, industrial and commercial products. 'Concurrently, our retail segment is also growing, supported by two wholly-owned malls, with a combined net lettable area (NLA) of approximately 608,000 sq ft and the upcoming KLGCC Mall with a NLA of about 240,000 sq ft,' he said. The group also has an existing land bank of about 11,400 acres with a GDV exceeding RM100bil to be unlocked, as it is also expanding into the high-growth data centre asset class with two hyperscale data centres at Elmina Business Park spanning across 126 acres, on top of a secured total lease value of RM7.6bil over a period of 20 years.
The Star
7 days ago
- Business
- The Star
Strong project pipeline boosts Kerjaya Prospek's outlook for FY25
PETALING JAYA: The market outlook for construction and property player Kerjaya Prospek Group Bhd remains solid after the company reported a 37% jump in net profit on the back of a 40% surge in revenue for the first quarter ended March 31, (1Q25) compared with the same quarter a year ago. The company also declared a first interim dividend of three sen per share payable on June 30. Several analysts have raised their target price on the stock following a meeting with Kerjaya's management, which was upbeat on achieving the company's target of RM1.6bil in new projects for this year, supported by year-to-date contract wins of RM870.3mil and an order book of RM4bil. Kenanga Research, which maintained an 'outperform' call on the stock and revised the target price to RM2.30 from RM2.10, said the company, in partnership with Samsung C&T Corp, expects decisions on three data centre projects worth RM3bil in 3Q25, in addition to listed subsidiary Eastern & Oriental Bhd 's planned launch of property projects worth RM2bil this year. The research house said the company's property arm can expect its 55%-owned Rivanis redevelopment project located in Butterworth, Penang, to anchor future earnings. BIMB Research said the higher interim dividend compared with an expected 2.5 sen reflected the management's confidence in its earnings outlook and strong cash position.
The Star
29-05-2025
- Business
- The Star
Project pipeline boosts Kerjaya Prospek's outlook
PETALING JAYA: The market outlook for construction and property player Kerjaya Prospek Group Bhd remains solid after the company reported a 37% jump in net profit on a 40% surge in revenue for the first quarter ended March 31, 2025 (1Q25) compared to the same quarter a year ago that were largely in line with expectations. The company also declared a first interim dividend of three sen per share payable on June 30. Several analysts have raised their target price on the stock following a meeting with the Kerjaya's management, who were upbeat on achieving the company's target of RM1.6bil of new projects for the financial year ending December 31, 2025 (FY25) supported by year-to-date contract wins of RM870.3mil and an outstanding orderbook of RM4bil. Kenanga Research, which maintained an 'outperform' call on the stock and revised the target price to RM2.30 from RM2.10, said the company in partnership with Samsung C&T Corp expects decisions on three data centre projects worth RM3bil in 3Q25, in addition to listed subsidiary Eastern & Oriental Bhd 's planned RM2bil launch of property projects this year. It said the company's property arm can expect its 55%-owned Rivanis redevelopment project located in Butterworth, Penang to anchor future earnings. The research house has a neutral view of the company's 49% stake acquisition in Aspen Vision Land Sdn Bhd for RM98mil announced recently given the potential future capital commitments that could offset construction opportunities and property earnings. BIMB Securities said the higher first interim dividend declared compared to an expected 2.5 sen reflected the management's confidence in its earnings outlook and strong cash position. The research house expects a dividend payout of 12 sen for FY25, which translates to a dividend yield of 5.6% from the stock's last closing price. It has maintained a 'buy' call on the stock with an unchanged target price of RM2.59. TA Securities, which maintained a 'buy' call but revised its target price to RM2.97 from RM2.72, said the company have plans to expand its property development business through a capital expenditure allocation of RM550mil, with active scouting for landbank opportunities in Penang, the Klang Valley, and Johor backed by robust net cash position of RM336.7mil as at end-March 2025. RHB Research said earlier-than-expected wins of industrial jobs such as data centres before mid-FY25 and quicker-than-expected launches of the new phases of Aspen Vision City, which has an estimated gross development value of RM5bil on 14.16-ha of land could be re-rating catalysts for the stock, in which the brokerage has maintained a 'buy' call but revised upwards the target price to RM2.80 from RM2.67.
The Star
20-05-2025
- Business
- The Star
Latest MRCB project win lifts order book closer to RM6bil
PETALING JAYA: The announcement that Malaysian Resources Corp Bhd (MRCB) has been awarded the contract to build the Shah Alam Sports Complex brings the property and construction company's order book closer to the RM6bil target for this year, analysts say. The contract from Menteri Besar Selangor Inc (MBI) was announced last Friday. The project value of RM2.94bil exceeded the company's earlier guidance of RM1.5bil as the scope of work has widened and takes MRCB's order book to RM5.4bil. Analysts at Hong Leong Investment Bank Research (HLIB Research) and CIMB Research have maintained their 'buy' calls on the stock, with target price of 67 sen and 83 sen, respectively. HLIB Research said MRCB's total year-to-date order book far exceeded its assumption of RM4bil for this year and now expects the order book to rise to RM6bil with core profit after tax and minority interest tweaked by minus 0.9% for this year and 2.5% for 2026 while expecting earnings of RM88.7mil for 2027. The research house said management anticipates a pre-tax profit margin of 5% from the project with financing costs baked into the contract value. Terms of payment for the 48-month project would be through a land swap not exceeding RM200mil subject to agreement, with the remainder in cash. MRCB's management shared that the payment would be on deferred basis. HLIB Research said the deferred payment would likely result in the company having a higher net gearing that currently stands at 0.27 times. It said MRCB would likely manage its balance sheet through asset disposals to free up cash while there could be the potential conversion of the KL Sentral redevelopment project later this year that may boost the order book to beyond the RM10bil mark. CIMB Research said, given the highly specialised nature of the project, the contract could fetch a fairly attractive operating margin of between 5% and 8% minus financing costs with minimal execution risk given MRCB's track record. Construction is scheduled to begin in November for a targeted completion in 2029. The research house said that the three-fold increase in the contract value comes with a far lower funding risk as most of the construction work would be paid in cash apart from the 7% to be paid through a land swap versus the initial value to be paid entirely through a land swap. The research house said MRCB also has sufficient balance-sheet headroom and the option to monetise non-core assets if needed. CIMB Research said, despite MRCB's year-to-date project wins meeting 90% of the company's order book target of RM6bil, it was maintaining its earnings forecasts for now pending the detailed design and project specifications expected in six months time.
The Star
17-05-2025
- Business
- The Star
RM13.3bil in unclaimed monies recorded as at April 2025
BATU PAHAT: A total of RM13.3bill in unclaimed monies has been recorded by the Accountant-General's Department until April 2025. Accountant General Nor Yati Ahmad revealed that since the establishment of the unclaimed money system in 1977, only about RM4bil has been successfully claimed by rightful owners or their heirs. She said this was likely because many individuals or their heirs are either unaware that they have unclaimed money or had never checked with the Accountant-General's Department of Malaysia. "They can actually check or submit a claim application via the official portal or eGumis application and go to branches in each state. "We will also continue to intensify promotions and field activities to publicise the existence of unclaimed money because it can only be claimed by the owner or heir," she told reporters after opening the Kampung Angkat Madani and Santuni Madani programme at SK Minyak Beku here on Saturday (May 17). Meanwhile, she said under the programme, various activities were organised to support the local community and implement development projects, particularly those involving infrastructure improvements. "Among the physical development projects were upgrading water supply pipelines, repairing Islamic halls, constructing cemetery fences, enhancing funeral management facilities and handing over a funeral van," she said. She said the programme aims to bridge the development gap between rural and urban areas by improving essential infrastructure, community facilities and ensuring Internet access is not overlooked. She noted that the implementation of the programme in Johor marks the second such initiative after its successful rollout in Kampung Lubuk Antu, Sarawak, in 2024. – Bernama
