KUALA LUMPUR: Sime Darby Property Bhd remains cautious of the rising cost in its operations this year and will take on a disciplined management of several factors to safeguard its margins.
Chief executive officer and group managing director Datuk Seri Azmir Merican said SD Property is confident that it can sustain its momentum for 2026 but is also aware that it may be an unpredictable year ahead.
"We do see some cost factors coming in for 2026 especially on transportation cost, cost of import of raw materials. Of course in terms of ringgit appreciation, that will bode well.
"Overall, we are cautious of the cost increases that happened in 2025. There are several factors that we need to manage this year to protect our margins," he told a press briefing in conjunction with the company's financial year 2025 financial performance.
He noted that the company took measures to contain margins in FY25 following several matters that contributed to the rise in cost of operations.
"There was the expanded Sales and Service Tax and new electricity tariff that led to the rising cost last year. That is why in 2025 we took actions to contain margins," he said.
SD Property achieved record sales of RM4.2 billion in FY25.
The company's net profit rose three per cent year-on-year (YoY) to RM517.74 million in FY25 compared to RM502.2 million a year prior.
However, revenue eased to RM4.18 billion from RM4.25 billion a year prior.
For the fourth quarter ended Dec 31, 2025, the company posted a lower net profit of RM87.56 million from RM88.41 million in the same quarter the previous year. Revenue rose to RM1.04 billion from RM977.04 million in Q4 FY24.
The group launched products with a total gross development value of about RM3.6 billion during the year.
Industrial products were the largest contributor at 37 per cent, followed by residential landed at 36 per cent, residential high-rise at 15 per cent and commercial at 12 per cent.
Commenting on the concerns over oversupply in the high-rise segments, Azmir said the company is confident at its product as it meets customers' demands.
"We spend a lot of time looking at the product and understanding the customer before we launch. That's why we are confident in our high rise products," he said.
The company set a sales target of RM4 billion this year and planned launches of about RM4.7 billion in GDV, covering both local and international markets.
"We remain committed to advancing our transformation into a real estate company, while maintaining a clear focus on disciplined execution, portfolio diversification and the expansion of recurring income streams.
"Guided by our purpose, we are confident that our strategic landbank and robust pipeline of industrial and residential projects will allow us to maintain our leadership position and deliver consistent value to our shareholders," said Azmir.
SD Property declared a second dividend of 1.70 sen per share for Q4 FY25, bringing the total dividend for the year to 3.20 sen per share, amounting to a total payout of RM217.6 million.