Sinarmas Land H1 profit dips 14.1% despite higher revenue
PROPERTY developer Sinarmas Land ’s net profit for the half year ended Jun 30 fell 14.1 per cent to S$109.5 million, from S$127.5 million in the corresponding year-ago period, it announced on Friday (Aug 11).
This was despite revenue increasing 16.9 per cent year on year (yoy) to S$592.5 million, from S$506.8 million.
The revenue climb was attributed to higher sales of commercial and residential land parcels in BSD City and Kota Deltamas in Indonesia, as well as an increase in revenue from residential units, apartments and commercial shophouses.
The decrease in net profit comes as cost of sales increased 83 per cent to S$220.1 million, from S$120.3 million.
In line with this, gross profit decreased 3.7 per cent to S$372.4 million, from S$386.5 million the year before.
Gross profit margin therefore also dipped to 62.9 per cent from 76.3 per cent in H1 FY2022, due to the sale of land parcels with a lower profit margin.
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Total operating expenses increased 11.6 per cent yoy to S$151 million, from S$135.3 million, due to higher promotion and marketing expenses incurred on higher revenue from the Indonesia segment, as well as higher salaries and related expenses.
Meanwhile, the group’s share of profit from joint ventures returned to the black at S$15.8 million, compared to a S$11 million loss in the year-ago period. This was due to higher sales of completed residential and commercial units, as well as higher recognition of realised profit on sales of land parcels in certain joint ventures in Indonesia.
Earnings per share for the period was S$0.0257, down from S$0.03.
The mainboard-listed group is cautiously optimistic about its business outlook, as its Indonesian-listed subsidiaries have posted steady performances.
It noted that its newest investment property, the Thamrin Nine Autograph Tower, will augment recurring income.
The group will continue to explore new investment opportunities outside Indonesia, ranging from real estate development to investment properties.
Prior to the results, shares of Sinarmas Land closed at S$0.193, down 1 per cent or S$0.002, on Friday.
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