Rowsley reports higher profit, will launch Johor residential project soon

SINGAPORE - Rowsley reported third-quarter net profit of $52.6 million, reversing from a loss of $2.6 million previously.

While this reflected steady contribution from its consultancy services, the bottomline was boosted by a $52.1 million accounting gain from the remeasurement of purchase amount payable to the RSP vendors as part of the acquisition in September 2013.

Rowsley had acquired RSP Architects Planners & Engineers, Singapore's leading architectural and engineering practice, for $187.5 million.

The payment comprised an initial amount of $131.3 million and an earn-out amount of $56.3 million to be paid in 375 million shares valued at 15 cents a share.

Accounting rules stipulate that the acquisition, which was completed on September 25, 2013, was to be remeasured to 33.8 cents a share and the earn-out amount $126.8 million.

The earn-out amount was remeasured again in the third quarter to $74.6 million at 19.9 cents per share, for an accounting gain of $52.1 million.

The remeasurement was based on the share price of Rowsley as at Sept 30.

Group revenue amounted to $21 million, primarily due to contribution from RSP and its subsidiaries.

Expenses totalled $23.9 million, up from $3.9 million previously, mainly from the inclusion of operating expenses of RSP, as well as reflecting higher operating expenses of the enlarged group.

Staff costs amounted to $14.8 million, up from $343,000 in the same period last year.

Earnings per share were 1.235 cents against loss of 0.215 cent previously while net asset value per share rose to 12.27 cents compared to 10.87 cents as at Dec 31.

Looking ahead, Rowsley said it is making preparations for the development of its first residential project in Johor, Vantage Bay - Skies.

It is in process of obtaining the advertising permit and developer's licence to allow it to sell the apartments.

Skies has received exemption from the RM1 million minimum price for property purchases by foreigners. These buyers are still subject to a RM500,000 minimum purchase price.

Skies has also obtained approval for its foreign buyer quota to be increased from 30 per cent to 92 per cent.