Mixed results were posted by developers in Q3 2016. City Developments Limited (CDL) reported an increase in profit while UOL Group reported a decline.
The net profit of CDL increased by 60.1% from $106.4m recorded last year to $170.3m.
The increase was attributed to increased sales in the property development segment and gains from the divestiture of the 52.52% stake in City e-Solutions Ltd, a Hong-Kong listed company.
Revenue increased by 14% to $922.8 m, with a large contribution being from the property development segment that includes the first contributions from Singapore’s Gramercy Park and UK’s Hanover House. Other contributors were D’Nest, Coco Palms and The Venue Residences.
CDL’s net gearing was 27% as at September 30, 2016. This is excluding investment properties’ fair value surpluses. The cash and cash equivalents were $3 billion.
“To enhance returns to shareholders, the company is reviewing its business model and asset portfolio,” revealed Kwek Leng Beng, CDL executive chairman.
He added that the Group is accelerating its diversification initiatives and it will continue focusing on improving its performance wherever possible across all the segments – hotel operations, funds management, property development and funds management.
On the other hand, UOL reported a 14% fall to $87.1m in quarter three in its net attributable profits. The drop was attributed to lower contributions from joint ventures and lower gross profit margin.
Joint venture and associated companies share of profits reduced by 35% to $29.1m. Thomson Three and Archipelago whose completion was in May 2016 and September 2015 respectively also had lower contributions.
However, Group revenue increased by 11% to $393.4 m. The property development segment had a 19% increase to $206.6m as a result of higher progressive income recognition from Principal Garden, Riverbank @ Fernvale and Botanique @ Bartley.
In its SGX filing, the company said that although the funding of acquisition of London’s 110 High Holborn and advances for funding The Clement Canopy were from the new loans secured, it used funds from operations to offset these loans.