UIC Q2 net profit falls 33% on fair value losses

Artist's impression of V on Shenton, developed by United Industrial Corporation (UIC).
Artist's impression of V on Shenton, developed by United Industrial Corporation (UIC). PHOTO: SAVILLS

SINGAPORE - Property developer and investor United Industrial Corp reported on Friday (July 28) a 33 per cent fall in net profit to $74.7 million in the second quarter from a year earlier after booking a fair value loss on investment properties.

In the three months to June 30, UIC took a fair value loss of $3 million, reversing from a $51.5 million fair value gain a year earlier.

Removing these effects, UIC's net profit from operations was $77.7 million, 29 per cent higher than a year ago.

Revenue in the three months ended June 30 rose 53 per cent to $361.9 million, lifted by a 123 per cent rise in sales recognition from trading properties to $231.5 million.

In particular, UIC saw higher sales in Pollen & Bleu and progressive sales recognition for V on Shenton.

In line with this, cost of sales rose 62 per cent to $254.4 million, owing to the cost of properties held for sale sold.

Gross rental income from investment properties remained stable at $67.9 million versus $67.8 million a year ago.

Revenue from hotel operations dipped 1 per cent to $34.4 million.

Second quarter earnings per share including fair value losses and gains on investment properties was 5.2 cents, down from 7.9 cents a year ago.

Net asset value per share was $4.44 as at June 30, up from $4.39 as at Dec 31 last year.

Earnings were posted after market close. The counter closed unchanged at $3.21 yesterday.

UIC said: "The rental market is expected to improve with the continued steady take-up of office and retail space.

"With the steady response from sales launches and the aggressive land bids by developers, the improving sentiments in the residential market are expected to continue.

"The hotel sector will remain competitive but positive, despite new hotel room supply coming on stream."