CapitaLand Ltd., the biggest developer in Southeast Asia, said its third-quarter revenue dropped 33 percent from the previous year.

Net income in the third quarter fell to $201 million ($281.3 million) from last year’s S$419.4 million, according to a statement released by Singapore stock exchange. Revenue increased by 75 percent to S$1.05 billion as property markets in China, Singapore and Vietnam rebounded.

The recovery of the global economy helped CapitaLand achieve its smallest profit decline in a year as well as return to profit from its incurred loss in more than five years during the second quarter. The economy of Singapore grew 0.8 percent in the previous quarter, making its first gain in a year, while the gross domestic product of China grew faster during the period.

“The results were pretty decent and we think the recovery in volumes will be sustainable,” revealed Lau Wei Chong, an analyst at Singapore’s AmFraser Securities Pte. Ltd.

Earnings per share dropped to 6.5 cents from last year’s 11.9 cents. Earnings on the previous year included S$432.7 million gain from properties’ sale of stakes in Singapore and China as well as the goodwill gain of CapitaLand which increases its stakes in the Australand Property Group.

Earnings before tax and interest of CapitaLand Residential Singapore improved more than six times as the developer accepted profit from its Latitude and Seafront on Meyer projects.

During the quarter, CapitaLand began its sales at The Interlace in order to capitalize the rebound of real-estate demands. In addition, a 165-unit development project situated at the former site of Char Yong Gardens, will be launched in the fourth quarter, CapitaLand said.

According to the Urban Redevelopment Authority, home prices rose 15.8 percent in the third quarter. This is the first increase of home prices in over a year and the largest quarter-on-quarter profit since March 1981.

“The group has performed significantly better this quarter than the previous two quarters,” said Liew Mun Leong, Chief Executive Officer. “We have had healthy sales volumes in Singapore, China and Vietnam.”

The company also sold 1,611 units in China within nine months, doubling the units sold on the previous year.

According to the National Bureau of Statistics, 2.8 percent increase on home prices was evident in September, as stimulus spending and record lending prompted a recovery in the fastest-growing major economy in the world.

Australand Property said it will continue to watch for signs of “stabilization and improved sentiment” in the last quarter of the year. Given the output for the country’s economic recovery, the company remains “cautiously optimistic” that the momentum will be sustained.

CapitaLand Retail also accounted a sixfold growth in profit since the revenues of its malls in Malaysia and China increased as well. The launching of Ion Orchard mall in Singapore also “contributed positively” to the business.

According to the developer, as CapitaLand adds properties all over Asia, it plans to sell shares in its shopping mall business. It will seek the approval of shareholders this week for the listing of CapitaMalls Asia Limited, said CEO Liew.

“If CapitaLand succeeds in listing the unit before the end of the year and gets above one time book value for its mall assets, we will see some significant revaluation gains that will pull up its full-year results,” said AmFraser’s Lau.
Check out my Rock Solid Links:
Cephas's Great Estates Insights and Highlights
Cephas's Great Estates For Sale
Email me




Share / Save This Post