Business Times: Sat, Aug 04
SINGAPORE Land and its parent United Industrial Corporation (UIC) posted declines in second-quarter net earnings on the back of lower profit from operations and lower fair value gains on investment properties.
SingLand, a major office landlord, reported an 85 per cent year-on-year (y-o-y) drop in Q2 group net profit to $46.5 million.
Revenue slipped 40 per cent y-o-y to $104.2 million, due mainly to lower sales of trading property and lower revenue from Pan Pacific Singapore hotel, which was closed for major renovation works from April this year. The hotel is due to reopen in stages from this month.
Progressive sales recognition of The Trizon condo in the Mount Sinai area at $39.6 million reflects a decline of $45.7 million or 54 per cent - due mainly to lower percentage of completion as the project was completed in May this year.
Fair value gains of investment properties declined from $247.6 million in Q2 2011 to $5.6 million in Q2 2012.
For the first half, SingLand's net profit fell 72 per cent y-o-y to $101.9 million. Revenue dipped 4 per cent to $299.7 million over the same period.
SingLand said the office rental market will continue to be competitive amid the uncertain global environment. On a brighter note, it added: "The robust domestic consumption, healthy visitor arrivals and interest from international retailers will help the retail rental and hospitality markets to stay resilient. With high liquidity, low interest rates and the good leasing demand, the local private residential sales market is expected to remain stable."
SingLand is expected to launch a five-storey condo in the Jervois/Bishopsgate area around October/November. The 110-unit project, which will have one-bedroom-plus-study units to four-bedders, could be priced around $1,800-$1,900 per square foot (psf) on average. The group will also be developing an eight-storey project of about 100-120 units at Farrer Drive, which could go on the market in Q1 2013.
At the Archipelago condo facing Bedok Reservoir Park - SingLand's joint venture project with UOL Group - about 85 per cent of the 577 units have been sold at around $1,050 psf on average. All three projects are 99-year-leasehold.
SingLand's earnings per share (EPS) fell from 76.9 cents in Q2 2011 to 11.3 cents in Q2 2012. Net asset value (NAV) per share stood at $11.69 at end-June 2012, up three cents from end-2011.
UIC posted a 46 per cent y-o-y drop in Q2 net profit to $82.2 million on the back of a 41 per cent revenue slide to $139.3 million. Fair value gain on investment properties fell from $147.8 million in Q2 2011 to $51.95 million in Q2 2012.
For the first half, UIC's net profit declined 37 per cent y-o-y to $126.5 million amid a 14 per cent revenue drop to $372.8 million.
Sales at UIC's V on Shenton condo are said to have crossed the 150-unit mark. The 99-year project is priced at $2,200 psf on average.
UIC's EPS slipped from 11.1 cents in Q2 2011 to six cents in Q2 2012. NAV per share stood at $3.18 at end-June 2012, up five cents from end-2011.
UIC closed at $2.58 and SingLand at $6.05 yesterday, each up one cent.
Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G)
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