Higher profit for Mah Sing

Mah Sing Group Bhd, which had unbilled sales of RM5.26bil as at Dec 31, 2014, finished the year strongly with a net profit of RM84.55mil for its fourth quarter, a 20% increase from the RM70.70mil it had registered in the previous corresponding period.

Unbilled sales refers to revenue which has been recognised but not billed to the purchaser.

For its fourth quarter ended Dec 31, 2014, revenue surged to RM843.95mil from RM570.21mil in the previous corresponding period.

In a note to Bursa Malaysia yesterday, the company said net profit for its financial year ended Dec 31, 2014 (FY14) increased 21% to RM339.25mil from RM280.62mil in the previous corresponding period, while revenue increased to RM2.90bil from RM2.0bil a year earlier.

“For the year ended Dec 31, 2014, the group achieved property sales of approximately RM3.43bil as a result of its focus on products priced below RM1mil, mainly in the Klang Valley, which is in line with market demand,” it said.

Mah Sing said improvement in results for 2014 compared to the previous year was attributable to the higher work progress and sales from the group’s ongoing development projects such as Icon City in Petaling Jaya, Garden Residence, Clover@Garden Residence and Garden Plaza in Cyberjaya, M-City in Jalan Ampang and M Residence in Rawang.

CIMB Research in a report said the company’s 2014 results were largely in line with expectations.

“Mah Sing’s 2014 results were in line with expectations, as net profit made up 99% of our full-year forecast and 103% of consensus estimates,” said CIMB Research.

“This is very commendable, given that most of its peers suffered sales declines in 2014.”

Mah Sing has also proposed a first and final single-tier dividend of 6.5 sen per share, consistent with its dividend payout policy of a minimum of 40% of net profit.

“This is equivalent to approximately two times the revenue recognised from the property division in 2014 and assures the group of near-term revenue visibility and steady streams of cash flows and liquidity.”

An analyst said prospects for the company looked positive, given the company’s unbilled sales position.

“The company also has a number of projects in the pipeline, which should help sustain earnings in 2015,” he said.

Mah Sing, meanwhile, said it had set a sales target of at least RM3.43bil for FY15, banking on its new phase launches and new project launches in Greater KL, the Klang Valley, Penang, Iskandar Malaysia in Johor Baru and Kota Kinabalu, Sabah.

“New phase launches will come from Savanna Executive Suites@Southville City, M Residence 2@Rawang, Lakeville Residence in Taman Wahyu, D’Sara Sentral in Sungai Buloh, Ferringhi Residence 2 in Penang, Meridin Bayvue@Sierra Perdana, Johor Baru and Sutera Avenue in Kota Kinabalu.

“Other projects in the pipeline include Bandar Meridin East in Iskandar, Johor Baru, M Residence 3 in Rawang and Icon Residence in George Town. In addition, the group will also be preparing new projects in Festival Lakecity, Puchong and Seremban for preview,” it said. - By The Star