CDL gain jumps 333% to $194m in second quarter
Developer sold 1,315 new homes at half-time from only 386 last year
By Fiona Chan, Property Reporter
POSSIBLE BENEFITS: Mr Kwek says more dividends may ‘come down the road’ for CDL’s shareholders. — BT FILE PHOTO
A LARGE jump in the number of homes City Developments (CDL) sold in the second quarter led to a quadrupling of its net profit.
The developer, Singapore’s second largest, yesterday posted a 333.2 per cent surge in net profit to $194.4 million for the three months ended June 30.
Revenue grew 28.8 per cent to $775.2 million, from $601.9 million previously.
For the first half of the year, net profit rose 272.3 per cent to a record $320.5 million, while revenue climbed 35.1 per cent to $1.54 billion, also a historic high.
This strong performance was mainly due to a much higher take-up of CDL projects this year, said group general manager Chia Ngiang Hong. From January to June this year, CDL sold 1,315 homes worth a total of $2.39 billion. In the same period last year, it sold only 386 homes worth $815.1 million in all.
CDL was quick to note that it had not included in its profit statement gains from revaluing its properties at fair value. Other property firms have recently adopted this practice, boosting their bottom lines, but CDL said it wished to retain a ‘conservative’ accounting policy on this issue.
If CDL had counted revaluation gains for the first half, its net profit would have been lifted by about $1.5 billion to $1.8 billion, estimated chief financial officer Goh Ann Nee.
CDL also declared a special interim cash dividend of 10 cents per share, taxed at 18 per cent. Ms Goh added that the group’s current tax credits stand at $360 million.
‘Our intention is to try to benefit all shareholders as a whole,’ CDL executive chairman Kwek Leng Beng said when asked how CDL intends to use its remaining credits.
‘As a first sign, we are paying a special dividend, and there may be more to come down the road.’
CDL’s earnings per share jumped to 20.7 cents for the second quarter, from 4.2 cents a year ago. Net asset value per share rose to $5.44 as at June 30, from $5.21 as at Dec 31.
CDL said it is confident of remaining profitable for the rest of the year.
Apart from its property development unit, which made up 57 per cent of pre-tax profits in the first half, CDL also has a strong office portfolio.
Mr Chia revealed that Republic Plaza has achieved record rentals of $17.50 per sq ft per month, and that more than the usual number of CDL’s office leases are up for renewal next year.
Source : Straits Times - 15 Aug 2007
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