KUALA LUMPUR (Aug 29): Mah Sing Group Bhd’s net profit for the second quarter ended June 30, 2022 (2QFY22) rose 6.52% to RM43.04 million from RM40.4 million last year, driven by the group's successful launches of new parcels of affordably priced homes and good take-up of its other ongoing projects.
According to group founder and managing director Tan Sri Leong Hoy Kum, the group's performance was boosted by the local economy's recovery momentum following the reopening of the country's borders.
As a result, earnings per share rose to 0.85 sen from 0.55 sen, according to the property developer’s Bursa Malaysia filing on Monday (Aug 29). Quarterly revenue grew 23.56% to RM542.01 million from RM438.67 million.
Mah Sing said it achieved RM550 million in property sales in the quarter under review, which pushed its sales for the first half of FY22 (1HFY22) to RM1 billion. The quarterly and half-year sales achieved, which were the group's highest since 2017, placed it on track to achieve its full-year sales target of RM2 billion.
The group's property development business posted an operating profit of RM148.1 million in 2QFY22, up 19.86% from RM123.59 million in 2QFY21, with revenue climbing 14.42% to RM746.18 million from RM652.14 million.
Its manufacturing segment, however, posted an operating loss of RM8.99 million as compared to an operating profit of RM6.13 million previously, despite revenue rising 19.52% to RM214.05 million from RM179.09 million, mainly due to lower absorption of overheads due to low production volume at its glove plant. "Barring unforeseen circumstances, the group expects plant efficiency and performance to improve as production volume ramps up,” it said.
For 1HFY22, Mah Sing posted a net profit of RM86.21 million, up 6.86% from RM80.68 million in the corresponding half-year period in FY21, as revenue grew 14.47% to RM975.24 million from RM851.99 million.
Going into 2HFY22, Mah Sing expects to maintain its strong sales momentum, on the back of its shift to focus more on affordable developments, and the launch of its homeownership campaign — Home Ownership Made Easy — to help address buyers' concerns about saving up for a down payment and qualifying for a loan. The campaign will run from July 1 until Sept 30.
“It is proven that the government’s Home Ownership Campaign (HOC) is a successful campaign in driving property sales; thus, the creation of this campaign by Mah Sing is a replica of HOC, aiming to alleviate homeowners’ pain points,” Leong said.
He said the campaign also complements the government’s Keluarga Malaysia Home Ownership Initiative (i-MILIKI) introduced in mid-July this year — with 100% stamp duty exemption for properties priced under RM500,000 and 50% stamp duty exemption for homes priced between RM500,000 and RM1 million — which is set to benefit the group even further.
“We are confident in the group’s ability to ride the wave, as 94% of Mah Sing’s product offerings are priced at RM700,000 or less, 60% at RM500,000 or less,” he added.
Mah Sing shares settled unchanged at 60 sen on Monday, giving the group a market capitalisation of RM1.46 billion.