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Firm’s third-quarter income more than doubles, as core markets deliver sterling results.

ASIA’S resilient boom has been brought home to CapitaLand - literally, in the form of rocketing sales of residential property across the region.

The property giant, which reported robust third-quarter results yesterday, has cashed in spectacularly on the demand for housing - with more to come.

Chief executive Liew Mun Leong said: ‘Our core markets of Singapore, China and Australia continue to deliver sterling results. We continue to expand our footprint in growth markets like Vietnam, the Gulf Co-operation Council region and India.’

Chairman Richard Hu agreed, saying the group is in a ‘good position to benefit from Asia’s positive growth’.

‘Our expansion in China, including second-tier cities, is bearing fruit as evidenced by the strong results.’

Mr Liew indicated that the firm is confident about the region’s continuing prosperity, pointing out that CapitaLand has invested more than $8 billion in new businesses this year.

‘As the region grows, our strong balance sheet and healthy earnings growth allow us to capitalise on investment opportunities that arise.’

The firm’s net profit for the three months ended Sept 30 more than doubled to $563.9 million, powered by robust growth in China and Singapore.

Revenue jumped 25 per cent to $895.8 million, up from $718.7 million a year ago.

Included in CapitaLand’s profit after tax and minority interests in the quarter were gains totalling $211.3 million from the sale of Savu Properties, Hotel Asia, Jiulong Mall and other investments.

Profit from jointly controlled entities leapt 778.6 per cent to $278.1 million, mainly due to ‘the share of fair value gain from the AIG Tower in Hong Kong and divestment gain from Somerset Baywater’.

The firm attributed the increased revenue largely to ‘higher sales from China’s development projects and revenue from Raffles City Shanghai’.

Its biggest revenue driver came from sales of homes in Singapore, China and other markets, which climbed 30 per cent to $664.5 million.

Revenue at its retail unit rose 56 per cent to $33.1 million in the third quarter, while sales from its commercial property business jumped 60 per cent to $49.1 million.

Earnings per share in the quarter rose to 20.1 cents from a restated 9.9 cents a year earlier, while net asset value per share rose from $2.65 to $3.32.

Profit after tax and minority interests for the first nine months was $2.1 billion, nearly four times higher than the same period last year.

If unrealised revaluation gains of $650.6 million are excluded, the group’s profit after tax and minority interests was $1.4 billion, nearly three times more than last year.

Source : Straits Times - 27 Oct 2007

CapitaLand’s third-quarter net profit more than doubled from a year earlier, buoyed by strong growth in China, the region’s largest property developer said.

The profit after tax and minority interests for three months ended Sept 30 stood at $563.9 million, up from last year’s $272.4 million.

Revenue was $895.8 million, up 24.6 per cent from $718.7 million.

“The group continues to see healthy and sustainable growth prospects in Asia and other new markets,” said CapitaLand chairman Richard Hu.

“Our expansion in China, including second-tier cities, is bearing fruit, as evidenced by the strong results. In Singapore, we also expect a solid full-year performance, underpinned by strength in all property segments,” he added.

For the year to September, net profit was $2.1 billion, nearly four times the previous year’s $559.2 million.

The 42-per-cent Temasek-owned developer, the largest in South-east Asia by market capitalisation, said that earnings before interest and tax for the Singapore market was up nearly four times to $1.7 billion for the year to September, while China’s contribution for the period was $714.6 million.

Mr Liew Mun Leong, the president and chief executive officer, said that while CapitaLand’s core markets of Singapore, China and Australia continue to deliver sterling results, “we continue to expand our footprint in growth markets like Vietnam, the Gulf Cooperation Council region and India”.

For the year to date, CapitaLand has committed investments of more than $8 billion in new businesses and new geographies, as exemplified by our recent Raffles City site acquisitions,” Mr Liew said.

“As the region grows, our strong balance sheet and healthy earnings growth allow us to capitalise on investment opportunities that arise.”

Source : Weekend - 27 Oct 2007

Turnover surges 49.4% to $382m mainly due to robust residential sales.

KEPPEL Land, Singapore’s third-largest developer by market value, yesterday said that net profit for its third quarter more than doubled on strong home sales and higher office rents.

Net profit for the three months ended Sept 30, 2007, hit $81.8 million, up 112.7 per cent from the $38.5 million recorded a year ago.

Earnings per share rose 111.1 per cent to 11.4 cents, from 5.4 cents a year ago.

Profit was boosted by a 49.4 per cent increase in turnover to $382 million - from $255.6 million a year ago - which KepLand attributed mainly to robust residential sales in Singapore and abroad.

The developer saw higher revenues from Park Infinia at Wee Nam, The Suites at Central and Freesia Woods in Singapore. It also reported higher revenues from 8 Park Avenue and The Seasons in China and Elita Promenade in India. KepLand also saw maiden revenue contribution from its newly launched Villa Riviera in China.

Rental income from the group’s office buildings was also higher compared to the third quarter of 2006, KepLand said.

For the nine months ended September 30, 2007, KepLand’s net profit rose 74.1 per cent to $207.3 million, while turnover climbed 71 per cent to $1.04 billion.

Earnings per share rose 73.5 per cent to 28.8 cents.

KepLand sold a total of 750 homes in Singapore in the first nine months of 2007, it said.

Strong sales were achieved at Reflections at Keppel Bay, with all 600 launched units sold.

As a result, profit from Singapore grew a significant 184.6 per cent to $134.6 million for the first nine months of the year.

With the increase, the proportion of group profit from Singapore expanded to about 65 per cent, as compared to 40 per cent for the same period in 2006.

Going forward, KepLand, together with joint venture partners Cheung Kong Holdings and Hongkong Land will launch the 223-unit Marina Bay Suites early next year on the back of hot demand for private homes.

Official data shows that private home prices have climbed 22.6 per cent since the start of the year. Said KepLand: ‘The group will release other prime residential projects in tandem with market demand.’

The developer also added that it will benefit from rising office rents in Singapore, both through its own properties and through its listed trust K-Reit Asia.

Grade A office rentals hit $14.90 per square foot (psf) per month in the third quarter, up 70.7 per cent from $8.73 psf at end- 2006, according to data from CB Richard Ellis. KepLand owns about 40 per cent of K-Reit.

KepLand also said it sold more than 2,200 homes overseas in the first nine months of the year - mainly in China and India.

And riding on the strength of the overseas markets, the developer hopes to launch several new projects in China, Vietnam and India in the fourth quarter of 2007.

KepLand’s shares rose five cents to close at $8.25 yesterday. The stock has climbed some 19.6 per cent since the start of the year.

Source : Business Times - 24 Oct 2007

Commercial trust may include VivoCity; company eyes big growth overseas.

Mapletree Investments intends to list a commercial trust with a $3-$3.5 billion portfolio in the next six months as it moves to grow its fee income and expand its footprint overseas, says chief executive Hiew Yoon Khong.

‘Over the next four years we want to scale up our capital management business by being very active in key markets,’ he told The Business Times in a recent interview.

Besides Singapore, the company is looking at China, India and Vietnam for acquisitions. And in the slightly longer term it is also interested in Taiwan, South Korea and Thailand - particularly their logistics and industrial sectors.

The plan is to bump up revenue from fee income to 50 per cent of overall revenue in the next three to five years - from just 9 per cent in Mapletree’s last financial year.

To grow the capital management business, the company has opted to look abroad. Right now only about 20 per cent of its portfolio is outside Singapore. But Mr Hiew said the proportion could be as high as 80 per cent in five years.

‘As a group, we hope to be able to break into one or two new markets a year,’ he said. The greatest opportunities, he believes, are in China, where Mapletree is now looking at second-tier cities. First-tier cities are ‘too crowded and the values are too high,’ he said.

In particular, Mapletree is trying to expand its commercial presence in Singapore and the region.

‘People know us as a logistics player, but as a company we are a lot more than that,’ Mr Hiew said. ‘Looking forward, we will be bidding for land to do development work. In Singapore, we are keen to have a bit more exposure to the office sector in particular.’

One way to do this is through the upcoming commercial trust - which the market has been waiting for.

The trust will likely contain VivoCity - Mapletree’s largest asset, with a book value of about $1.6 billion - as well as other commercial properties including office buildings Harbourfront Centre and PSA Building and nightspot St James Power Station, Mr Hiew said.

Mapletree is already lining up a pipeline of assets for the trust. In a break from tradition, the company this year started bidding for commercial land sites in Singapore.

In July it won a government land sales site at Anson Road/Enggor Street in a public tender that drew other big names such as CapitaLand and Keppel Land. Mapletree’s offer was 23 per cent higher than the next highest bid.

In addition, Mapletree is likely to launch a Reit based on assets in India, with its Indian property development partner Embassy Group, by the first half of 2008.

Market talk of Embassy’s Reit, which will be managed through a joint-venture partnership between Embassy and Mapletree, has been around since early this year. Mr Hiew confirmed plans for the Reit.

‘We will probably hold some sort of equity stake in the trust but that is not finalised yet,’ he said.

Mapletree has also secured a deal to co-manage the Lippo Group’s Indonesia-focused retail Reit. The prospectus for this Reit was lodged with the Monetary Authority of Singapore (MAS) last Friday.

Mr Hiew is also committed to growing Mapletree’s private equity franchises. For example, the company - together with its partner CIMB - will be launching its second Malaysia fund in the next six months.

Mapletree’s growing portfolio in Singapore and overseas will serve as an asset pipeline for both the existing Mapletree Logistics Trust and the new commercial trust, as well as any funds the company might set up in future.

‘We are very keen to support the growth of our Reits and fund business,’ Mr Hiew said.

With its asset-light strategy in place, the company will now be able to take on bigger projects and move faster on them.

Right now, assets under management stand at $2.2 billion, while Mapletree owns a further $4.8 billion of assets. Mr Hiew’s aim is to grow by $1 billion or so each year.

‘Four years ago we mapped out strategic initiatives for the company to enhance our value,’ he said. ‘When we review the programme now, we are happy with the progress to date but will look to scale up these businesses much more.’

Source : Business Times - 24 Oct 2007

With mouthwatering results and growing sophistication, it’s come a long way since 2000

LISTED developers in Singapore now have a relatively new kid on the block to watch out for - Temasek-owned Mapletree Investments.

Under the stewardship of Hiew Yoon Khong, who took over the helm in August 2003, Mapletree has expanded its overseas presence and grown its capital management business.

And this year, the company has started going head-to-head with established developers to compete for land sites.

Mapletree’s strategy has translated into solid financial numbers.

During its 2006 financial year, Mapletree’s earnings crossed the billion-dollar mark for the first time - a milestone achieved by only one other property company in Singapore, CapitaLand. Mapletree’s net profit came to $1.07 billion, a seven-fold increase over the previous year.

While the bulk of the earnings spike was due to valuation gains from its newly-opened mega-mall VivoCity, operating revenue itself grew by 35 per cent to $216.6 million.

During the year, Mapletree’s asset portfolio also grew from $2.97 billion to $4.53 billion.

But more significant than the improved numbers is the fact that over the last few years, Mapletree has become a much more sophisticated entity.

Mr Hiew told BT that going forward, Mapletree will continue to grow its capital management business and overseas footprint - in line with what other developers in Singapore are doing.

Big but nimble

Growing the capital management business will also allow Mapletree to go asset-light, which will allow it to move more quickly and take on bigger projects.

For example, setting up the commercial trust, which will have a portfolio of $3 billion to $3.5 billion, means that Mapletree will be able to recycle assets worth that amount, said Mr Hiew. It is quite clear that he intends to put the money to good use. Mapletree has signalled this year that it is more than just a holding company for state-owned properties by bidding for and winning a government land sales site at Anson Road/Enggor Street in July.

Mapletree’s offer was a bullish 23 per cent higher than the next highest offer - a clear sign that the company is serious about building up its commercial landbank.

Last month, Mapletree also formed a joint venture with CapitaLand to offer $1.8 billion - or $1,281 per square foot per plot ratio - for a white site at Marina Bay, but lost out to Macquarie Global Property Advisors.

With the bulk of its commercial properties divested into the upcoming trust, a flush-with-cash Mapletree will no doubt be a serious contender for sites.

Mr Hiew said that he wants to grow Mapletree’s exposure to the office sector in Singapore in particular.

The company has certainly come a long way since it was incorporated in December 2000 to hold the property assets transferred by PSA to Temasek Holdings.

Going forward, it will be interesting to watch Mapletree make its mark on the property landscape as it comes into its own over the next few years.

Source : Business Times - 24 Oct 2007