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Sinarmas Land announces 55% rise in 1Q earnings to $43.3 mil on revenue growth, lower expenses

Michelle Zhu
Michelle Zhu • 2 min read
Sinarmas Land announces 55% rise in 1Q earnings to $43.3 mil on revenue growth, lower expenses
SINGAPORE (May 13): Sinarmas Land has reported 54.6% higher 1Q earnings of $43.3 million from $28 million in 1Q18, which came on the back higher revenue and margins as well as lower expenses.
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SINGAPORE (May 13): Sinarmas Land has reported 54.6% higher 1Q earnings of $43.3 million from $28 million in 1Q18, which came on the back higher revenue and margins as well as lower expenses.

Revenue for the quarter grew 6.9% y-o-y to $199.9 million from $187 million on the back of higher sales of commercial land plots, as well as growth in sales of residential units in BSD City, Indonesia.

This, along with a higher overall gross profit margin of 73.7% compared to 69.5% a year ago, has helped to boost 1Q19 gross profit to $147.4 million from $130 million a year ago.

Selling expenses, on the other hand, decreased 12.2% to $19.9 million from $22.7 million due to lower promotion and marketing expenses incurred.

General and administrative expenses also fell 11.8% to $32.9 million from $37.3 million previously due to lower depreciation and amortisation expense, as well as lower salaries and related expenses.

As such, earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 30.3% to $133.4 million over the quarter, while EBITDA margin rose 12 ppt to 66.7% from 54.7% in 1Q18.

Over the quarter, Sinarmas Land also recorded a share of profit in joint ventures of $6 million as opposed to a $3 million loss a year ago, mainly due to higher sales of residential units in certain joint ventures in Indonesia.

Other operating income rose 52.9% to $11.1 million mainly due to higher estate management fees and fair value gains on financial assets.

As at end-March, cash and cash equivalents stood at $1.06 billion, up from $984.1 million in the previous year.

Looking ahead, Margaretha Widjaja, executive director and vice chairman of Sinarmas Land’s SML Indonesia Division, says the Indonesia property division remains cautious for the rest of the year amidst ongoing economic challenges and trade war tensions between China and the US.

She nonetheless expects the group’s listed subsidiary, PT Puradelta Lestari Tbk, to help cushion expected weakness in other segments of the property market.

“For our International property division, we continued to expand our presence in China, having invested in a 30% stake in a residential development project in Taicang city, located about 50km north-west of Shanghai Hongqiao airport,” she adds.

Shares in Sinarmas Land closed 1.92% lower at 26 cents on Monday.

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