International Marketing S P Setia Bhd Sales

Question: Discuss about the International Marketingfor S P Setia Bhd Sales. Answer: Introduction As one of the biggest developers in the property and house management at in Malaysia, the road for S P Setia Bhd has not always been that easy. Based in Malaysia, the company has been able to achieve a net profit of RM 6.2 billion by the end of 2016 financial year. This was however not its target as it went RM 2 billion below what they had forecasted in the same year. Some of the issues that have cause this include unbilled sales from Vietnam, Australia and Britain. Reasons Some of the reasons is the uncertainty that company has when it comes to the international markets like the United Kingdom, where it has its Battersea Power Station joint venture project. As much as previous earnings from other projects should support good dividend by the company. The company posted a RM134.07 million net profit on the RM1.26 billion revenue for the 3rd quarter financial year of 2016. At the end of the year the net profit of the company stood at RM383.24 million on revenue of RM3.19billion. There were however unbilled revenues from the Parque Melbourne and the Battersea Powerstation ( Phase 1) in Australia and Britain respectively. This caused no year to year comparable figure which made the company change its financial year from October 31st to December 31st in 2016(theedgeproperty, 2017). There is also the issue of tighter lending from the foreign banks that has seen the company to revise downwards its sales since the year 2015(spsetia, 2017). This causes less change in earning projection. More earning is also underpinned by RM8.39 billion of Unbilled sales. The company also finds it difficult to maintain its BUY with unchanged Target Prices with regard to revalued net asset value. The company has actually as to record a lower RM 2 billion according to its quarterly report. As much as the sales from Malaysia projects are said to have registered a great improvement in the second quarter, the international projects are still a great challenge for the company. they continue to post weaker sales that are blamed on the uncertainty of business in the United Kingdoms housing markets, especially after the general elections that had a poor impact on the countrys sales(theedgeproperty, 2017). The company needs to implement some defensive strategies to be able to earn from their new projects in Australia and the United Kingdom. These projects will be major contributors to positive development in terms of sales and revenue collection. So long as the company reduces borrowing and promotes their products internally and outside the country, the will be able to realize increase in sales. One of the positive cases has been its operations in Malaysia where the company achieved a net profit of RM134.07million , which also translated to 4.88 sen per share in the first third quarter of 2016 which in total added to a revenue of RM 1.2 billion due to strong sales in the previous quarters of RM943million(theedgeproperty, 2017). If the same is followed in other countries where it operates the company is bound to grow in sales. References mahpar, h., 2015. SP Setia lowers 2015 sales target amid uncertain environment. [Online] Available at: https://www.thestar.com.my/business/business-news/2015/06/16/sp-setia-lowers-2015-sales-target-amid-uncertain-environment/[Accessed 12 April 2017]. spsetia, 2017. annual report. [Online] Available at: https://www.spsetia.com.my/corporate/annual-reports.asp theedgeproperty, 2017. S P Setia 'bumper earnings' seen RHB. [Online] Available at: https://www.theedgeproperty.com.my/tags/battersea-power-station [Accessed 12 April 2017].