SGHOUSING.COM 新加坡房地产网

Keppel Corp leads at half-time with record full-year earnings of $1.13b

THE stock market may have had a torrid time of late, but the financial reporting season has so far brought little but big smiles for investors.

With the reporting season for companies with Dec 31 year-ends now at the halfway mark, Singapore has so far registered another sterling year of profits.

Among the 32 Singapore- listed early birds that had reported by 5pm last Friday, total profits were $4.07 billion, up a dazzling 68.3 per cent on the $2.42 billion for 2006.

Of those that reported full- year results, 31 were in the black. And 22 of them posted higher earnings.

Racking up the largest profit number, in absolute terms, was Keppel Corp. The company’s earnings for the 12 months ended Dec 31 last year rose 50.6 per cent to $1.13 billion, thanks mainly to booming business at its oil rig and shipbuilding unit.

Keppel’s record gain calmed jittery investors concerned over whether it might face foreign-exchange losses similar to those that rocked other offshore and marine companies like SembCorp Marine (SembMarine) last year.

SembMarine, now mired in a lawsuit with BNP Paribas over forex losses, will report full-year results on Feb 22.

The sharp spikes in crude oil prices last year also helped propel the full-year net earnings of Keppel associate, Singapore Petroleum Company, to a record of $508.3 million.

On the property front, many real estate investment trusts have unveiled strong full-year profit scorecards.

One of the top performers in that category is CapitaMall Trust, whose net income available for distribution for last year came to $211.2 million, up 25 per cent from the $169.4 million posted in the same period a year earlier.

One of the poorest performers was Evergro Properties - a member of the Keppel group - which reported a 97.4 per cent plunge in full-year net profit for last year on the back of lower divestment gains.

Several big-cap counters - including StarHub, ComfortDelGro, City Developments, Great Eastern Holdings and SembCorp Industries - are due to report their results this month.

However, it is the traditional top earners - DBS Group Holdings, United Overseas Bank (UOB) and OCBC Bank - that are likely to come under the most scrutiny, with analysts not ruling out more write-downs on assets linked to United States sub-prime mortgages.

‘What is currently of utmost concern are the results of the local banks, as great uncertainty and anxiety rule in the wake of the big casualties surfacing from the sub-prime fiasco affecting the top banks and brokerages in the world,’ said Mr Najeeb Jarhom, the senior vice-president of research at AmFraser Securities.

Another concern is how the net interest margins of local banks will be affected by the falling Singapore interbank offered rate (Sibor) - the rate at which banks lend to one another.

‘A falling Sibor environment is likely to post a threat to the net interest margins of Singapore banks, as all three of them are net interbank lenders,’ said Kim Eng analyst Pauline Lee.

Economists expect the Sibor to go even lower by midyear, due partly to the US cutting its key interest rate.

Phillip Securities Research investment analyst Brandon Ng has declared OCBC his top pick. OCBC is a conservative bank and made the largest provisions in the last quarter to cover the fallout from risky debt, compared with UOB and DBS, he said.

Deutsche Bank analyst Michael Chang feels Singapore banks offer cheap valuations for their rapidly improving fundamentals.

‘We recommend an overweight position,’ he noted.

Source : Straits Times - 4 Feb 2008

INVESTORS might be tempted at first to blame a slowing housing market for a 25 per cent slide in GuocoLand’s second-quarter earnings.

A closer scrutiny of the property developer’s accounts, however, shows that for the quarter ended Dec 31, it actually reaped higher revenue from its property development projects in Singapore and China.

In fact, the explanation for the profit slump was the sale of its long-term investment in BIL International in the second quarter ended Dec 31, 2006, which boosted its bottom line in the earlier period to the tune of a $19.3 million one-off gain.

GuocoLand’s net profit for the second quarter ended Dec 31 plunged to $33.9 million, from $45.4 million a year earlier. With the one-off gain stripped out, net profits were well up this year.

Revenue soared 112 per cent to $211.1 million, up from $99.6 million in the previous period.

Gross profit rose from $16.4 million to $40.2 million, with contribution from its West End Point project in Beijing.

West End Point, an 810-unit development in the Xicheng District of Beijing, is almost fully sold, GuocoLand said yesterday.

In Singapore, GuocoLand has three launched developments on the market: Le Crescendo, The View@Meyer and The Quartz.

As at this month, it achieved sales of about 90 per cent for Le Crescendo, The View@Meyer and the launched units in The Quartz.

GuocoLand said it has, in the pipeline, ‘prestigious’ residential developments in prime districts which will be built on the sites of the existing Sophia Court and Leedon Heights.

Earnings per share for the quarter fell from 7.31 cents to 4.02 cents, while net asset value per share remained unchanged at $2.30.

Source : Straits Times - 31 Jan 2008

Property developer GuocoLand has reported a net profit of S$60.6 million for its half year ended December 31.

That was a 15 percent increase compared to the same period a year ago. Revenue rose 114 percent to S$402 million.

However, net profit in the second quarter actually fell 26 percent to S$33 million. This was due to the absence of an exceptional gain that was booked in the year-ago period.

GuocoLand also reported losses linked to foreign exchange hedging.

Going forward, GuocoLand is looking to develop more residential properties in the prime districts of Singapore. It will build residential properties on the sites of the existing Sophia Court and Leedon Heights.

It is also expanding its footprint in China, Malaysia and Vietnam.

The developer said that although the spectre of a recession is looming over the US economy, China and India are expected to remain resilient.

Barring unforeseen circumstances, GuocoLand expects to report satisfactory results for its third quarter and full year.

Source : ChannelNewsAsia - 30 Jan 2008

FY2007: boost from residential sales and revaluation and restructuring surplus.

KEPPEL Land’s turnover crossed the billion-dollar mark in 2007 to hit a record $1.4 billion, a rise of 48.5 per cent from the previous year’s $948 million.

The 12-month period ended Dec 31, 2007, saw profit after tax and minority interests (Patmi) more than trebled from $200.3 million to a record $779.7 million. This was bolstered by strong residential sales, a net gain on revaluation of investment properties of $343.6 million, and a rise of $100.5 million under an item which includes corporate restructuring surplus and enbloc property sales. The latter $100.5 million gain was after taking into consideration a $235.2 million surplus from the restructuring of its one-third interest in One Raffles Quay and $89 million in offsets to account for the diminution in value of the group’s Myanmar hotels and the fall in the value of rupiah relating to its prior investments.

Full-year earnings per share came to 108.3 cents, up from 2006’s 27.9 cents. Q4 Patmi rose from $81.2 million to $572.3 million while turnover climbed 8.6 per cent to $371.4 million.

Related links: Click here for KepLand’s press release Financial statement Presentation slides

Announcing its financial results yesterday, KepLand group CEO Kevin Wong also said that it was proposing a final one-tier dividend of 8 cents per share and a special dividend of 12 cents to ‘reward shareholders for their support’. The proposed dividends amount to $144 million.

Patmi from property trading made up 35 per cent or $274.9 million of the total 2007 Patmi. Mr Wong said this was driven by profit contribution from Singapore developments including Marina Bay Residences, Reflections at Keppel Bay and Park Infinia at Wee Nam.

Contributions from overseas business made up 39.6 per cent while Singapore business contributed 60.4 per cent, up from 36.4 per cent in the previous year. For the year ahead, Mr Wong said that overseas contributions from residential properties will likely increase to about 50 per cent, in light of the weakening US economy. ‘Our projects are mostly in China and Vietnam, and the subprime effect on these two countries will be less.’

He added that most of its development projects in these two countries were targeted at the mid- to high-end market which was supported by ‘genuine buyers’. He also said the newly instituted capital gains tax in Vietnam should add stability to the market there. ‘Demand for housing in these two countries is coming from a very low base,’ he added.

In 2007, Keppel Land acquired eight residential sites in Vietnam with a total of 22,225 potential units for sale. Three developments are expected to be launched this year.

Other overseas launches for 2008 include a 1,000 unit residential development in Jeddah, Saudi Arabia, while two mega developments with over 8,000 units in Shanghai and Shenyang, China, is expected to be launched in 2009.

Mr Wong said it will continue to look for potential development sites and these will likely be in China, Vietnam and the Middle-East. Highlighting Keppel Land’s low gearing of 0.41 per cent, and the possibility of borrowing to fund future acquisitions, he also said: ‘We can gear up.’

At the end of the trading day yesterday, Keppel Land shares closed 2 cents higher at $6.45 per share.

Source : Business Times - 30 Jan 2008

Boosted by sale of stake in One Raffles Quay, the firm posts a seven-fold surge in Q4 profits to $572 million

Keppel Land kicked off the current quarterly earnings for the property sector on a positive note with a strong set of results, but analysts said the sharp gains may not be repeated in the current year as businesses could face weaker business conditions.

The seven-fold surge in net profit to $572 million for the three months ended Dec 31 was boosted by a one-time capital gain from the sale of its one-third stake in One Raffles Quay (picture).

Keppel Land is proposing a final dividend of 8 cents per share and a special dividend of 12 cents per share. For the full year, it said profit after tax rose almost four times to $780 million from $200.3 million the year before.

Singapore’s second largest property developer’s results bids well for the rest of the sector, but analysts warned that property developers in general may not see such buoyant conditions this year, with weak market sentiment resulting in delays in property launches.

The launch of the Marina Bay Suites has been delayed until after Chinese New Year “to wait until people get their bonuses and perhaps, after people get their hongbao (red packet)”, said Keppel Land chief executive officer Kevin Wong.

Both housing and office property prices reached records last year, but with the US sub-prime crisis widening, companies are starting to tighten their spending on worries of a global slowdown.

The latest Urban Redevelopment Authority data showed that sales and rental prices for private residential and office properties have risen at a slower pace in the fourth quarter versus the third quarter of 2007. For the whole of last year, private home prices rose 31.2 per cent and prices of office space rose 32.6 per cent.

The rising price trend will continue and will broaden to the mass residential market, but the gains won’t be as aggressive, with analysts forecasting no more than a 15-per-cent rise in property prices on average.

“The drivers for earnings growth this year (for Keppel Land) are most likely from projects in emerging markets like China and Vietnam,” said CIMB analyst Donald Chua.

Source : Today - 30 Jan 2008