CDL posts 60.1% jump in Q3 profit, to step up diversification initiatives

City Developments Ltd reported on Thursday (Nov 10) a 60.1 per cent jump in net profit for its third quarter to S$170.3 million from S$106.4 million a year ago.
City Developments Ltd reported on Thursday (Nov 10) a 60.1 per cent jump in net profit for its third quarter to S$170.3 million from S$106.4 million a year ago. PHOTO: CITY DEVELOPMENTS

SINGAPORE - City Developments Ltd reported on Thursday (Nov 10) a 60.1 per cent jump in net profit for its third quarter to S$170.3 million from S$106.4 million a year ago.

CDL credited this to strong property sales and gains from the divestment of its entire 52.52 per cent interest in Hong Kong-listed City e-Solutions Limited.

The divestment was the big contributor to the jump in other operating income by S$49.6 million to S$50.2 million for the third quarter, and S$65.6 million to S$73.5 million for the year to date.

Revenue rose 14 per cent to S$922.8 million, driven by the property development segment, including maiden contribution from the Gramercy Park project in Singapore and Hanover House project in Reading, United Kingdom, as well as contribution from the Coco Palms, D'Nest and The Venue Residences and Shoppes projects in Singapore.

CDL said that over 70 per cent of the total 519 units of its newly-launched Forest Woods condo project have been sold, with an average selling price of about S$1,400 per square foot.

It said that notwithstanding the challenging market conditions, it has achieved steady sales for its other Singapore projects. The 174-unit Gramercy Park along Grange Road has sold 38 of the 40 units released for sale, while the 616-unit Jewel @ Buangkok is fully sold. As for the group's joint venture projects, the 944-unit Coco Palms in Pasir Ris is over 91 per cent sold and The Brownstone, a 638-unit executive condominium next to the upcoming Canberra MRT station, is almost 80 per cent sold.

CDL executive chairman Kwek Leng Beng said the group is reviewing its asset portfolio and business model to boost shareholder returns.

"We are accelerating our diversification initiatives and will continue to focus on improving the group's performance wherever possible, across all segments - property development, hotel operations, investment properties and funds management.

"We have an exceptionally robust balance sheet and are building our war chest to capture attractive opportunities during this period of market dislocation."

CDL said that as at Sept 30, its net gearing was 27 per cent, excluding any fair value surpluses on investment properties, with cash and cash equivalents at S$3 billion.

CDL CEO Grant Kelley added that the group has stepped up the growth of its international property and funds management businesses as part of its diversification strategy.

"Following the successful execution of our third Profit Participation Securities platform in October, we now have over S$3.5 billion in funds under management, on track to achieving our target of S$5 billion.

"Moving forward, we will continue to explore initiatives to enhance recurring income streams, and hone in on our existing development projects."