FINANCIAL RESULTS & GROUP UPDATE
FOR THE YEAR ENDED 31 DECEMBER 2018
27 February 2019 Strengthened Position as No 1 Property Developer in Malaysia
SALES
Local 80%
International 20%
International, 1,001 , 20% Eastern, 9 , <1% Northern, 198 , 4% Total Sales RM5,123
Southern, million 805 , 16% Central, 3,110, 60%
Sales for I&P Projects 2017 = RM859mil 2018 = RM1,250mil (46% )
2 SALES EXCEED TARGET Stronger Contribution led by Central and Southern Regions
6,000 RM 5.123b RM 5.0b RM 4.920b 5,000
1,001 979
1,509 9 4,000 31 198 461 - 805 144 729 3,000 587
2,000
3,110 2,680 2,800 1,000
- Actual FY2017 Target FY2018 Actual FY2018
Central Southern Northern Eastern International 3 RM8.33b SALES FROM BATTERSEA PHASE 2 - COMMERCIAL Setia’s Equity Stake Equals to RM3.33b
RM 8.45b 9,000 (with Battersea Ph2)
8,000
7,000 3,332
6,000 RM 5.0b RM 4.920b 5,000 979 1,001 1,509 9 4,000 31 198 461 - 805 144 729 3,000 587
2,000 3,111 2,680 2,800 1,000
- Actual FY2017 Target FY2018 Actual FY2018
Central Southern Northern Eastern International Battersea 4 5 YEARS FINANCIAL HIGHLIGHTS Commendable Revenue
Group Revenue (RM'million) 8,000
7,000 6,746
6,000 12 months revenue = RM5,606 million 4,957 5,000 4,520
4,000 3,870 3,594
3,000
2,000
1,000
- FY2014 FY2015 FY2016 FY2017 FY2018 14 months 5 5 YEARS FINANCIAL HIGHLIGHTS
Profit Before Tax Profit attributable to shareholders (RM'million) (RM'million) 1,600 1,000 918 933 1,426 900 1,400 1,271 808 1,185 800 12 months = 710 million 1,200 671 12 months = 1,123 million 991 700 1,000 600 800 722 500 406 600 400 400 300 200 200 - 100 FY2014 FY2015 FY2016 FY2017 FY2018 - 14 months FY2014 FY2015 FY2016 FY2017 FY2018 14 months Earnings Per Share (Sen) Dividend Per Share (Sen) 40.0 25.0 23.0 35.7 35.0 20.0 29.8 20.0 30.0 12 months = 27.7 26.8 15.5 25.0 15.0 20.0 16.3 9.7 14.8 10.0 8.55 15.0
10.0 5.0 5.0
- - FY2014 FY2015 FY2016 FY2017 FY2018 FY2014 FY2015 FY2016 FY2017 FY2018 14 months 14 months 6 SNAPSHOT OF FINANCIALS
Profit & Loss (RM million) FY2017 FY2018
Revenue 4,520 3,594 Gross Profit 1,514 1,092 Gross Profit Margin (%) 33.5 30.4 Profit Before Tax 1,271 991 Profit Attributable to Shareholders 933 671 Basic Earnings per Share (RM sen) 26.8 14.8 Dividend per Share (RM sen) 15.5 8.55 Dividend Payout Ratio (%) 70.1* 70.1 * Including the pre-acquisition dividend payout by I&P Group during the year.
Balance Sheet (RM million) FY2017 FY2018
Shareholders’ Funds 11,944 14,144 Total Equity 13,798 15,520 Total Assets 27,724 29,337 Total Cash 5,579 2,883 Total Borrowings 6,933 10,534 Net Gearing Ratio (times) 0.10 0.49 Net Assets per share (RM sen) 2.85 3.03
7 LAND BANKING IN FY2018
RESILIENT GROWTH… LAND BANKING Total of 87.9 Acres of New Land Banks were Acquired with Potential GDV Contribution of RM12.52 billion
Land Banks Acquired in FY2018
Setia Federal Hill Setia Izumisano City Center Setia Federal Hill Osaka, Japan Setia Safiro Kuala Lumpur Cyberjaya, Selangor additional GDV of GDV of GDV of RM10b RM1.87b RM650m remaining 4.9 57 acres acres 26 acres
9 KEY PROJECTS UPDATE
TRANSFORMATION UNFOLDING… S P SETIA’S STARTER HOMES SERIES WAS WELL RECEIVED
Careya – were sold out on the day it was launched
CAREYA – TYPE K
RM585k onwards
Adina - >90% sold during the launch weekend
TYPE N2 TYPE N1
RM530k onwards
11 S P SETIA’S STARTER HOMES SERIES WAS WELL RECEIVED
Carisa - >90% sold during the launch weekend
TYPE M
RM593k onwards
Bellina - >80% sold to-date
Land Area: 20’ x 70’
12 KL ECO CITY, FIRST INTERGRATED TRANSIT-ORIENTED DEVELOPMENT
World class integrated development of 25 acres with total GDV of RM7.0 billion, located in Kuala Lumpur.
DEVELOPMENT BRIEF
Mixed Development Type Development
Effective Stake 100%
Purchase Year 2011
Comm. Date 2011
Completion Date 2022
Total Area 25 acres
Remaining Area 4.2 acres
Estimated GDV RM7.0 bn
KL Eco City – Masterplan Remaining GDV RM3.26 bn 1313 KL ECO CITY – PROGRESS UPDATE Handed Over Retail Hub & Podium and Office Tower 2 with GDV totaling RM800 million at the beginning of 2018
PARCEL
D C B A
Retail Podium Recurring income 100% (Recurring income portfolio of the Group) portfolio of Sold the Group
98% 100% Sold 98% 100% Sold 100% 100% Sold Sold Sold Sold
89% Sold
RESIDEN OFFICE SERVICED STRATA BOUTIQUE BOUTIQUE BOUTIQUE OFFICE TIAL MOSQUE RETAIL HUB TOWER RESIDENC OFFICE OFFICE 3 OFFICE 2 OFFICE 1 TOWER 2 TOWER 3 ES 1
VP in Jun’16 VP in VP in Sep’16 VP in Sep’16 VP in Apr’17 VP in Mar’18 VP in Feb’18 VP in Target to VP in Jul’16 Oct’17 complete in June’17 Oct’20
RETAIL PODIUM
VP in Feb’18
14 KL ECO CITY Development Brief
2018 December
15 KL ECO CITY Delivering Transit Oriented Development
Pedestrian Link Bridge Physical Completion : End of March 2019 Open to Public: Target Q2 2019. 16 KL ECO CITY Delivering Transit Oriented Development
The ceremony was officiated by the Transport Minister on 1 November 2018.
17 KL ECO CITY Office Tower 2
Area (sf) Percentage
Occupied (Moved in) 50,810 9%
Fit Out Works 108,340 20%
Confirmed Tenant - -
Head of Terms Exchanged 78,461 14%
Advanced Negotiations 48,646 9%
Available 258,104 47%
Total 544,361 100%
18 KL ECO CITY Office Tower 3
Area (sf) Percentage
Occupied (Moved in) 160,129 37%
Fit Out Works - -
- - Confirmed Tenant
- - Head of Terms Exchanged
28,892 7% Advanced Negotiations
Available 243,681 56%
Total 432,702 100%
19 KL ECO CITY KLEC Mall
5-storey mall with approximately NLA of 250,000 sq ft retail space
70% confirmed tenants – Soft opening in Sept 2018
RFC Fitness Page 20 20 KL ECO CITY Amari Hotel
Total 252 keys. Percentage of completion at 37%. Target VP in Aug 2020
Page 21 21 KL ECO CITY New Launches in FY2019
KL ECO CITY – Aspire Tower (OT1)
Aspire Tower (OT1) @ Parcel B
Total Gross GDV RM 1.075 bil
Built-up Range 1,153 – 18,715 sf
Total units 253 units
Price Range RM 1.6 - 32 mil
Typical Sizes Type Level (sq. ft.)
Executive Office 3A – 9 1,153 – 1936
Signature Office 10 – 23 3,630 – 12,263
Premier Office 23A – 39A 18,715
Wellness Club 2 18,347
Business Centre 3 15,528
Product Type Artist’s ImpressionSky Lounge 23 3,778
Sky Dining 41 & 42 3,410 – 5,081
Page 22 22 22 KL ECO CITY New Launches in FY2019
KL ECO CITY – RT2
RT2 @ Parcel A
Total Gross GDV RM 1,056 mil
Built-up Range 514 – 5,396 sf
Total units 739 units
Price Range RM 0.8 – 6.0 mil
Product Type Artist’s Impression
Page 23 23 23 SETIA FONTAINES Strategic Location
LAND BANK BRIEF
Land Size 1,675 acres
Land Type Freehold
Development Eco-themed mixed Plan development township
Estimated GDV RM13.05 billion
Tenure 20 years Strategically located as the focal point for the state of Penang, Setia Fontaines enjoys excellent connectivity to major towns like Sungai Petani to the north, Butterworth to the West, Bukit Mertajam to the south and Penang Island a short drive away via the Penang Bridge. The North South Expressway serves as the main thoroughfare with a northern exit from Bertam toll and southern exit 24 from Sungai Dua toll. 24 SETIA FONTAINES Strategic Location – Potential of 3rd Link
Statement from Penang Chief Minister on Penang’s third link on 20 February 2019
GEORGE TOWN, Feb 20 – Penang hopes to obtain approval for projects under its Penang Transport Master Plan (PTMP) within the first half of the year, Penang Chief Minister Chow Kon Yeow announced today.
“We are on the verge of securing approval for our major transport plan,” he said during a speech at a Chinese New Year gathering with the Real Estate and Housing Developers Association (Redha) this evening.
“The approval will spur the construction sector and provide opportunities for companies in the building and construction business,” he said.
He said the other mega project Penang is undertaking, the RM6.3 billion paired roads and undersea tunnel project, will also kick off this year.
2525 SETIA FONTAINES Strategic Location – Potential of 3rd Link
Statement from Penang Chief Minister on Penang’s third link on 20 February 2019
George Town: Penang Chief Minister today said he is optimistic and confident that the federal government would approve the state’s RM46 billion transport master plan (PTMP) in the first half of 2019.
Chow also announced that the construction of a 5.7km bypass road connecting Air Itam to the Tun Dr Lim Chong Eu Expressway will begin on Aug 31.
The road is part of a larger RM6.3 billion undersea tunnel and three roads project, undertaken by the Zenith consortium.
“This will definitely spur the building and construction industry in Penang and will uplift the state’s economy as a whole,” he said in his speech at the Real Estate and Housing Developers’ Association (Redha) Chinese New Year dinner at a hotel today.
2626 SETIA FONTAINES New Lifestyle Development in mainland Penang
MASTER PLAN
Artist’s Impression
Page 27 27 27 SETIA FONTAINES Precinct 1 - Inspired by Multi Award-Winning Townships
1
28 Page 28 28 SETIA FONTAINES Precinct 6 – Lush Greenery and Scenic Waterways
29 Page 29 29 29 SETIA FONTAINES CITY CENTRE BUSINESS HUB (“CCBH”) SOFT LAUNCH IN DEC 2018 WAS WELL RECEIVED On Balloting Day, Sold RM 67 million (82 units)
The launch of CCBH in Setia Fontaines Welcome Centre, Bandar Putra Bertam, Penang
Shop lot SETIA FONTAINES Gross Selling Price Range : RM630,800 onwards GDV: RM89m
30 SETIA FONTAINES New Launches In FY2019
Precinct 1-Amansara South (Landed-Residential) Total Gross GDV RM 137.40 mil
Built-up Range 1,310 - 1,812 sf
Total units 392 units
Price Range RM 330k to RM440k
Precinct 6-South (Landed-Residential) Total Gross GDV RM 185.00 mil
Built-up Range 1,332 - 2,943 sf
Total units 294 units
Price Range RM 420k to RM1.1 mil Product Type Artist’s Impression
31 Page 31 31 BATTERSEA POWER STATION, THE LARGEST REJUVENATION PROJECTS IN LONDON
Most Iconic development in the heart of London spanning 41.7 acres with total GDV of GBP9.2 billion.
Apple's New London Campus
An aerial view of Battersea Power Station, London 32 BATTERSEA POWER STATION Master Plan
Phase 1 – Completed 7
1
6
2 5 6 6 1 5 4
Phase 2 – Q4 2020 3 Phase 4a 3 4
Phase 3A – Q2 2021
NLE – 2021 (latest)
33 BATTERSEA POWER STATION Cross Section of Commercial Property in Phase 2
Signed Heads of Terms Residential on 18 Jan 2018 for sale Office of commercial property Retail and F&B to PNB and EPF Event Space Signed SPA on 14th December 2018 for £1.583 billion (RM8.33 billion)
34 BATTERSEA POWER STATION Focus to sell the remaining units of BPS. Expected completion of Ph2 in 4Q2020 and Ph3a in 2Q 2021.
Phase 1 Phase 2 Phase 3A (Circus West) (Power Station) (Electric Boulevard) Launched January 2013 Launched May 2014 Launched October 2014
GDV £846 m GDV £779 m GDV £948 m Units 867 Units 255 Units 539 Sold 865 units Sold 236 units Sold 376 units Remaining 2 units Remaining 19 units Remaining 163 units Take Up Rate 99% Take Up Rate 93% Take Up Rate 70% Completed Expected Expected 4Q 2017 4Q 2020 2Q 2021 Completion Completion
Expected Completion of the Northern Line Extension (“NLE”) by end of 2021. 35 ONGOING PROJECTS Wide Range of Product Offerings to Support Growth
45 ongoing projects
Central Southern Northern
19 Setia Alam 11 Setia Eco Cascadia 6 Setia Pearl Island Setia City Setia Tropika Setia Greens Setia Ecohill Setia Indah SPICE Setia Sky Vista Setia Ecohill 2 Setia Eco Gardens Setia Sky Ville Setia Eco Park Bukit Indah Johor Setia Fontaines Setia Eco Templer Setia Business Park II Eastern Setia Eco Glades Taman Perling Setia Sky Seputeh Taman Rinting 1 Aeropod Setia Seraya Residences Taman Pelangi TRIO by Setia KL Eco City Taman Pelangi Indah International Bandar Kinrara Taman Industri Jaya Temasya Glenmarie 8 Battersea Power Station Alam Impian Sapphire By The Gardens Bandar Baru Seri Petaling Uno, Melbourne Alam Sari Marque Residence Kota Bayuemas Eco Xuan Alam Damai Eco Lakes Alam Sutera Qinzhou Industrial Park Daintree Residence 36 FY2019 BUSINESS STRATEGIES AREAS OF FOCUS… FY2019 BUSINESS STRATEGIES Area of focus for the Group
1 2 3 4 New Disposal of Clearing Launches New Non- Unsold in Existing Projects Strategic Stocks Projects Lands/ Projects
Attractive Right product size Focus Launch on Monetise non- incentives scheme and pricing Landed Properties core assets Dynamic marketing for To focus on new phases in the unsold units in Klang To launch new projects in Disposal of non- existing established Valley, Pulau Pinang, Setia Alaman, Setia strategic land townships in Setia Alam Johor and Sabah through Mayuri, Setia Safiro and banks to monetise and Setia Ecohill. attractive incentives Setia Tropicale to suit the non-core assets scheme to monetise the current market demand. which doesn't fit To focus on optimization, existing inventories level. into our strategic rejuvenation and The Group will focus on plan and land banks revitalization of Bandar end users, target overseas which does not Kinrara, Kota Bayuemas, buyers and provide the have the scale that Bandar Baru Seri Petaling, right pricing packages. Setia township is Alam Damai, Alam Sutera, known for. Temasya Glenmarie and Alam Impian.
38 CLEARING OF UNSOLD STOCKS Completed Inventories reduced by 7% Y-o-Y
RM’Mil Completion of Setia Sky 88 (Tower A) 1,900 at RM225 million in Jul 2018
1,696 1,683 1,700 1,606 1,581
1,500 1,459
1,300
1,100
900
700
500 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
Unsold Stock at Cost 39 CLEARING OF UNSOLD STOCKS Summary of Existing Completed Inventories
THESE 5 COMPLETED PROJECTS ACCOUNT FOR 58% OF THE INVENTORIES
Setia Sky88, Setia Business Park, Setia Eco-Cascadia, Setia V-Residences, Alam Impian, Johor Johor Johor Penang Shah Alam
RM405mil RM149mil RM118mil RM151mil RM93mil
STRATEGY:
FOCUS ON END USERS
TARGET OVERSEAS BUYERS
RIGHT PRICING & FINANCING PACKAGES 40 PROJECTS LAUNCHED IN MALAYSIA FROM 2016 - 2018 Commendable take up rate of 64%
10,000 100% 9,000 81% 85% 8,000 80% 7,000 6,345 64% 5,755 6,000 60% 5,162 4,873 5,000 4,000 3,427 40% 3,000 2,178 2,000 20% 1,000 0 0% 2016 2017 2018 Units Launched Units Sold Take up rate (Units)
GDV Units Units Units Year Launched Take Up Rate* Launched Sold (billion) (%) 2016 RM4.60 6,345 5,162 81% (GDV = RM3.49bil) 2017 RM2.97 5,755 4,873 85% (GDV = RM2.31bil) 2018 RM2.75 3,427 2,178 64% (GDV = RM1.50bil)
* take up rate as at 31 Dec 2018 41 PLANNED NEW LAUNCHES IN FY2019 Combined GDV of RM6.80bil
Northern Eastern GDV GDV RM m 349 RM 164m
Central GDV RM 4,979m
Southern GDV Eco Lakes GDV RM 1,169m Eco Xuan RM 139m
Local Launches 98%
International Launches 2% 42 LAUNCHES OF NEW PHASES IN EXISTING PROJECTS Target to launch 8,247 units with GDV of RM6.01 billion
4,500 4,193
4,000
3,500
3,000
2,500
2,000
1,500 1,169 1,000 349 500 164 139 - Central Northern Southern Eastern International
Local Launches 98%
2% International Launches 43 LAUNCHES OF NEW PROJECTS Target to Launch 1,128 units with GDV of RM786 million
Focus launch on landed properties to suit market demand 44 TYPE & PRICE RANGE OF NEW LAUNCHES IN FY2019 BY GDV
Local Launches by Type Local Launches by Price Range
Commercial, ≤RM250k, 653 , 10% Landed Total GDV Residential, >RM1mil, Total GDV Apartment / RM6,660 3,211 , 48% 2,945 , 44% RM6,660 Condominium, million million 2,647 , 40% RMM, International Launches by Type International Launches by Price Range Commercial, 25 , 18% ≤RM250k, 110 , 79% Landed Residential, 41 , 30% Total GDV Total GDV RM139 RM139 million million Apartment / Condominium, Land size Estimated Market Location (acres) Value (RM’mil) Central Region 23.1 175 Southern Region 377.3 474 Northern Region 41.4 530 Total 441.8 1,179 46 SALES TARGET IN FY2019 MEETING THE UNDERLYING DEMAND… SALES TARGET IN FY2019 Sales RM5.65b Double Digit Growth International, SALES 646 , 11% Local 89% Eastern, International 11% 150 , 3% Northern, 395 , 7% Sales Target RM5.65 Southern, billion 754 , 13% GROWTH Central, 3,702 , 66% 10% 48 INNOVATIONS & INITIATIVES FOR THE GROUP IN 2019 INDUSTRIALISED BUILDING SYSTEM (“IBS”) Expanding the use of IBS for Landed Properties IBS is one of the construction method that can upgrade the quality and productivity of the construction by using better machineries, equipment, materials and extensive project planning. To extent the use of IBS to landed properties with : Standard Building Components Standard Bath Layout Standard Stairs Layout Standard Floor to Floor Height Layout Involvement during design & planning stage. To start in Setia Alam 2-storey terrace houses and to extent to Setia Ecohill. IBS offers a good reduction in cost compared to conventional system. Currently used in high rise construction To increase usage to landed residences 50 NEW TARGET GROUPS Expanding the reach to New Target Groups Senior Living: Care Centres Retirement Village Precinct Layout Elder Friendly Unit Layout Purpose-Build for AirBnb Dedicated Entrance & Facilities Within Development Flexi/Customised Units Choice of unit layout to suit lifestyle 51 SUMMARY Priorities In FY2019 To achieve the RM5.65 billion sales target and prepare beyond FY2019 with higher sales and profit Implementation and Execution of I&P land banks. Implementing New Initiatives & expanding to New Target Groups 52 UNBILLED SALES, LAND BANKS & GDV STRONG PIPELINE… UNBILLED SALES, LAND BANKS AND REMAINING GDV Unbilled Sales of RM12.32 billion is Supported by 9,516 acres of Remaining Land Banks and RM149.70 billion of Remaining GDV as at 31 December 2018 International, International, Eastern, 309 , 3% 16.68 , 11% 43, 1% Eastern, Northern, 1.94, 1% 1,809 , 19% Northern, 17.21 , 12% Remaining Remaining Landbanks GDV 9,516 RM149.7 acres billion Southern, 21.04 , 14% Southern, 2,327 , 24% Central, Central, 5,028 , 53% 92.82 , 62% Unbilled sales – Local = RM4.24 billion Unbilled sales – International = RM8.08 billion Remaining Land Banks and Remaining GDV * *Effective stake 54 AWARDS CLINCHED IN FY2018 Total of 22 Awards Clinched Crème de la crème 10-Time Winner 11-Time Winner 9-Time Winner World Gold Winner The Edge Top Property Best Employers in Malaysia FIABCI World Prix d’Excellence Developers Awards 2018 2018 Awards 2018 No. 1 S P Setia Corporate HQ -Sustainable Development Malaysia Landscape Architecture Awards MLAA *2017 Developer & GLC Category - Landscape Development Award The Malaysian Construction FIABCI Malaysia Property Award 2018 EcoHill Park, Setia EcoHill – Excellence Award SPICE – Purpose-Built Category Industry Excellence Awards Setia SPICE, Penang – Honour Award (MCIEA) 2017 Seri Kasturi Apartment – IBS Award Category 55 Q & A Thank You