KUALA LUMPUR: Mah Sing Group Berhad announced its net profit of approximately RM386.7 million on the back of revenue of approximately RM3.1 billion for the year 2015.
According to the press release, this represents 8.5% improvement in net profit and 7.0% improvement in revenue as compared to the previous financial year. On a quarterly basis, the Group recorded net profit of approximately RM112.9 million and a revenue of approximately RM773.1 million.
As at December 31 2015, the Group had a cash pile of approximately RM1.4 billion and net gearing at 0.04 times.
Property division continued to make gains
For the year ended on December 31 2015, revenue from property development was approximately RM2.8 billion, marking near to 7.9% improvement as compared to approximately RM2.6 billion achieved last year. Operating profit also increased by 2.0% from approximately RM449.1 million to approximately RM457.9 million.
The improvement was mainly attributed to the Group's ongoing development projects such as M City in Jalan Ampang; Southville City @ KL South, Icon City in Petaling Jaya; M Residence and M Residence 2 in Rawang; Kinrara Residence in Puchong and investment properties from Star Avenue Lifestyle Mall.
Gearing up to meet RM2.3 billion sales target
Mah Sing Group Berhad met its 2015 sales target of RM2.3 billion by offering products in line with market demand, namely beginner homes for the mass market and also upgrader homes in selected locations.
The Group’s strategy of targeting mainly the Klang Valley and products priced below RM1 million to provide more acquirable housing have been instrumental in the strong sales figures.
The Group will retain the same sales target of RM2.3 billion for 2016 by focusing on end-user demand for beginner homes.
As of December 31 2015, Mah Sing had a unbilled sales total of RM4.75 billion and a remaining Gross Development Value (GDV) of RM28.12 billion. The total RM32.87 billion will support the Group’s growth over the next 8 to 9 years.
The Group has charted strong growth with Net Profit compounded annual growth rate (CAGR) of 27% and industry leading Asset Turnover Ratio of 50% on average for the past 5 years.
Adhering to a disciplined financial management, Mah Sing has a high cash pile of approximately RM1.4 billion and a net gearing at 0.04 times as of December 31 2015, which is well below the internal target of 0.5 times.
Southville City, KL South-New GDV of RM11.1 billion
The GDV for the 428-acre freehold township of Southville City, KL South has been enhanced to RM11.1 billion from the new master plan to unlock greater value and enhancement of value proposition.
The upcoming High Speed Rail will benefit Southville City which is just 25km from the station in Bandar Malaysia. The direct interchange which directly connects Southville City to KL-Seremban is expected to be completed by end 2017, earlier than the scheduled completion in 2018.
Apart from shortening the distance to Southville City to just 19km from Kuala Lumpur (from Sg Besi Toll) and with convenient direct exit and arrival at the heart of Southville City, the direct Interchange offers transitional convenience to the regional communities wanting a quick connection to the KL-Seremban Highway.
After the successful sale of the Savanna Executive Suites, the subsequent affordable luxury residential suites namely Cerrado Residential Suites will soon be launched. Cerrado, priced from RM388,000 per unit, is now open for registration.
Strategy and prospects for 2016
To ensure sustainable growth, the Group will continue to accelerate work progress on projects with good take up, which will unlock the liquidity provided by the high RM4.75 billion unbilled sales. Furthermore, the expected final stage billings on delivery of vacant possession of properties will be amounting to approximately RM651 million in 2016. This will further enhance the Group’s cash position.
Future sales pipeline include Cerrado serviced apartments in Southville City@KL South, which are affordable luxury homes indicatively priced from RM388,000. There are also the new township of Laman Ayu township in Rawang, new blocks in D’sara Sentral and Lakeville Residence in the Central region, Ferringhi Residence 2 in Penang island and Meridin East township in Pasir Gudang with affordable landed homes, indicatively priced from RM350,000.
