Mah Sing Group Berhad Monday announced its full year results for the year ended 31 December 2014, posting a 15% growth in total sales volume at a record RM3.43billion, which has bolstered its overall performance for the year.

Full year 2014 financial highlights:

 

- Revenue increased 44.8% to RM2.9billion versus previous financial year

- Net profit increased 20.9% to RM339.2million versus previous financial year

 

This 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.

 

Other key contributors to the Group’s results were attributed to projects in:

 

- Kinrara Residence in Puchong, Icon Residence in Mont' Kiara, Southville City@KL South, M Residence 2 @ Rawang, Lakeville Residence in Taman Wahyu, D'sara Sentral in Sungai Buloh, M-Suites in Jalan Ampang and commercial projects such as Star Avenue @ D’sara and StarParc Point in Setapak.

 

- Ferringhi Residence, Southbay City and Legenda @ Southbay

Iskandar, Johor Bahru

 

- Mah Sing i-Parc @ Tanjung Pelepas, Austin Perdana, Sri Pulai Perdana 2, Sierra Perdana, and The Meridin @ Medini

Kota Kinabalu, Sabah

 

- Sutera Avenue

 

Diluted earnings per share stood at 22.17sen for 2014, representing an 11.7% improvement from the corresponding financial year.

 

Arising from the Group’s strong financial performance, the Board of Directors have proposed a first and final single-tier dividend of 6.5sen per ordinary share of RM0.50 each in respect of the financial year ended 31 December 2014, subject to shareholders’ approval in the upcoming Annual General Meeting.

As the share capital base is now enlarged with the Rights Issue and the proposed Bonus Issue, the 6.5sen dividend will still result in above 40% payout ratio. This is in line with the Group’s dividend payout policy of a minimum of 40% of net profit in delivering value and returns to its shareholders.

 

Mah Sing Group Berhad outperformed its sales from the previous financial year by approximately 15% to achieve a record RM3.43billion.

The Group’s strategy of targeting mainly in the Klang Valley and products priced below RM1million to provide more acquirable housing have been instrumental in the strong sales figures.

 

This was supported by the strategic pricing points of residential launches in 2014, 87% of which were below RM1million, 81% below RM700,000 and 45% below RM500,000. Comparatively for residential launches in 2015, 84% will be priced below RM1million, 71% of which are below RM700,000 and 44% of which are below RM500,000.

 

The Group’s unbilled sales position continued to advance to approximately RM5.264billion as at 31 December 2014. This is equivalent to approximately 2 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.

 

The Group further grew its landbank by 1,134 acres with the 3 proposed acquisitions of new lands in Puchong, Seremban and Shah Alam at an estimated gross development value (GDV) of RM19.3billion. For the Puchong land, the Group has also been granted the option for an additional 171 acres adjacent to the land. With this, the Group’s total remaining undeveloped landbank stands at 3,822 acres. As at 31 December 2014, the Group's unbilled sales combined with remaining GDV, including the Puchong land option is approximately RM65billion, which will last the Group for approximately 8 to 10 years.

 

In the recent Budget 2015 Revision, the Government’s decision to maintain infrastructure development projects in addition to MRT 1 such as MRT 2, LRT 3, and other major highways is expected to come as a boon for these landbanks which are being prepared for preview in 2015, and will stand to gain considerably from the improved public accessibility.

 

The MRT Line 2, LRT 3 and proposed Kuala Lumpur – Singapore High Speed Railway will also benefit the Group as 75% of its undeveloped landbanks are located in Greater KL and Seremban. The improved connectivity will also open up new property growth corridors, benefitting 34 out of the Group’s 48 projects in the Klang Valley, Greater KL and Seremban.

 

The Puchong land will see a proposed integrated mixed development with a potential GDV of approximately RM9.3billion, while the Seremban land will include a proposed residential development of terrace, superlink, Semi-D and bungalow homes with a potential GDV of approximately RM7.5billion.

 

The Group’s balance sheets have remained strong with a high cash pile of approximately RM639.2million and a net gearing at 0.36 times as at 31 December 2014, which is below the internal target of 0.5 times.

 

This has placed the Group in a strong position to continue with its expansion plans via landbanking exercises and development activities, supported by its unbilled sales locked in at RM5.264billion.

 

Building on the momentum of its stellar performance in 2014, the Group is confident that it will continue to deliver satisfactory performance for 2015 supported by the strong unbilled sales locked in at RM5.264billion which supports immediate term revenue and earnings delivery.

 

This year, new phase launches will come from Savanna Executive Suites@ Southville City, M Residence 2, Lakeville Residence, D’Sara Sentral, Ferringhi Residence 2, Meridin Bayvue@Sierra Perdana and Sutera Avenue. Other projects in the pipeline include Bandar Meridin East (Iskandar, JB), M Residence 3 (Rawang) and Icon Residence, Georgetown (Penang). In addition, the Group will also be preparing new lands in Puchong (Festival Lakecity) and Seremban for preview.

 

With healthy GDP and household income growth, young demography and stable employment conditions, the Group is confident that property will continue to be the preferred wealth preservation and investment option, and that the right products at right locations will continue to see healthy take-up rates to meet the current supply gap. Only 70,000 to 80,000 units of new homes are completed each year, while approximately 200,000 units of new properties are required to meet household formation arising from new marriages.

 

With proven strategy and execution capability, a well-established brand name, and right portfolio of products at different stages of project life cycles, the Group has the flexibility and is well-positioned to sustain its growth.

 

Against this background and confidence, the Group has set a sales target of at least RM3.43billion for the financial year 2015, banking on its new phase launches and new project launches in Greater KL, Klang Valley, Penang, Iskandar Malaysia in Johor Bahru and Kota Kinabalu, Sabah.

 

Launches and previews lined up for 2015 include:

 

- Savanna Executive Suites@ Southville City – targeted phase launch of final 2 condominium blocks in 2015 with built-ups from 956 sq ft onwards.

 

- Lakeville Residence in Taman Wahyu - Plans underway for new phase launch of 2 blocks of residential suites in 2H15 with built-ups from 978 sq ft onwards.

 

- D’Sara Sentral - Plans underway for new phase launch of its 2nd and 3rd block of serviced residences with a built-up of 809 sq ft onwards.

 

- M Residence@Rawang – targeted phase launch of 56 units of 2 ½-storey canal link homes with an estimated built-up of 3,168 sq ft in a gated and guarded community.

 

- M Residence 3@Rawang – Plans in place for 2-storey link homes, 2-storey Semi-Ds and 2-storey shops. First phase of 2-storey link homes targeted for 1H 2015 preview.

 

- Festival Lakecity, Puchong – Plans in place for preview of its Executive Suites in 2H15.

 

- Seremban Land - Plans in the pipeline for preview of link homes in the recently acquired Seremban land, featuring link homes with a built-up of 18 x 65 ft and 20 x 70 ft.

 

- Ferringhi Residence 2 - Previews of first block of Ferringhi Residence 2 resort condominiums anticipated in 1H15, with units ranging from a built-up area of 1,197 sq ft – 2,875 sq ft in a gated and guarded community.

 

- Icon Residence, Georgetown - Planned preview of freehold condominiums in 2015.

 

- Meridin Bayvue@Sierra Perdana - Plans underway for launch of final 2 blocks of serviced apartments with a built-up of 980 sq ft onwards.

 

- Bandar Meridin East – Expected preview of gated double-storey link homes by 1H15, with a lot size of 18 x 65 ft.

 

- Sutera Avenue – Expected launch of the second block of its 100-units serviced residences with built-ups measuring 726 sq ft – 1,220 sq ft.