Sinarmas Land A26 has reported earnings of $216.1 million for the 2HFY2022 ended Dec 31, 2022, nearly 3.6 times higher than the earnings of $60.1 million in the corresponding period the year before.
The surge was due to the higher revenue for the period as well as a gain of $87.7 million upon the disposal of the group’s UK subsidiary, Horseferry Property.
For the FY2022, the group’s earnings stood at $343.6 million, 135.8% higher y-o-y, and an all-time high. The revenue growth was mainly driven by higher sales of commercial and industrial land parcels in BSD City and Kota Deltamas, Indonesia, as well as higher revenue recognised from residential units and commercial shophouses.
During the FY2022, Sinarmas Land’s revenue surged by 48.8% y-o-y to $1.33 billion, another record.
Gross profit for the full year increased by 77.0% y-o-y to $964.5 million in tandem with the increase in land sales. Gross profit margin (GPM) also increased by 11.5 percentage points y-o-y to 72.4%.
Operating profit surged by 112.2% y-o-y to $651.0 million.
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During the FY2022, the group recorded a net foreign exchange (forex) loss of $28.1 million, compared to a gain of $2.2 million in the FY2021. The loss was mainly due to the stronger US dollar (USD) against the Indonesian rupiah and the weakening of the British pound against the Singapore dollar (SGD).
Share of results of associated companies fell by 78.1% y-o-y to $3.8 million while share of results of joint ventures (JV) fell to a loss of $28.6 million, down from the profit of $15.5 million in the FY2021. According to the group, the reversal of unrealised gain adjustment of $58.6 million, from the $2.9 million in the FY2021, impacted the group’s share of net results in joint ventures.
Without this reversal, on a like-for-like comparison between FY2022 and FY2021, the group’s share of profit in joint ventures increased from $18.3 million in FY2021 to $30.0 million in FY2022 mainly 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.
FY2022 saw the gain on disposal of its subsidiary (Horseferry Property) of $87.7 million, 259.1% higher y-o-y.
Earnings per share (EPS) for the 2HFY2022 and FY2022 stood at 5.08 cents and 8.07 cents respectively.
As at Dec 31, 2022, cash and cash equivalents stood at $1.41 billion.
A first and final dividend of 0.138 cent per share has been proposed for the period, up from the 0.9 cent per share in the year before.
The proposed dividend will be payable on June 27.
Noting the positive macroeconomic factors which included Indonesia’s record GDP growth of 5.31% for 2022 and the country benefitting from the global commodity boom from the aftermath of the Russia-Ukraine war, Sinarmas Land’s executive director and vice-chairman of the group’s Indonesia division, Margaretha Widjaja notes that the group’s PT Bumi Serpong Damai Tbk (BSDE) achieved marketing sales of IDR8.8 trillion ($778.0 million) for the FY2022, above the marketing sales target and the previous year's achievement by 14%.
“PT Puradelta Lestari Tbk (DMAS) achieved marketing sales of IDR1.86 trillion for FY2022, marginally above the full-year 2022 marketing sales target of IDR1.8 trillion, driven by strong demand from the information technology sector, particularly industrial land for data centres,” she says. “Riding on promising growth in this sector, the group entered into a joint venture with K2 Data Centres to develop hyperscale data centres in October 2022.”
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“While the reopening of China borders and lower inflationary pressure look to provide a much-needed reprieve in 2023, the escalating severity of Russia-Ukraine conflict and elevated interest rates continue to cast a shadow over the global economic outlook. Nevertheless, the group endeavours to deliver on our core competencies and seek out new growth through more joint ventures and partnerships in the year ahead,” she adds.
“For 2023, BSDE and DMAS announced a marketing sales target of IDR8.8 trillion and IDR1.8 trillion, respectively. BSDE expects its 2023 marketing sales target to be contributed mainly by residential developments, while DMAS expects industrial land sales to be the key sales driver,” she continues. “In 2023, the group will continue to seek collaboration opportunities with strong regional partners, focusing on acquisition opportunities, asset enhancements, driving rental reversions for better yields and riding on our track record of delivering sustainable profits.”
Shares in Sinarmas Land closed 0.2 cent lower or 1.11% down at 17.8 cents on Feb 27.
