Subdued performances from local property development and hotel divisions were a drag on first-quarter net profit and revenue at City Developments (CDL).
Earnings for the three months to March 31 fell 14.4 per cent from a year earlier to $105.3 million, while revenue slipped 11.2 per cent to $723.3 million, it said yesterday.
The property development segment reported lower profits, owing to reduced contribution from its completed residential projects as well as the absence of profit from The Rainforest executive condominium, which was recognised in its entirety in the first quarter of last year.
CDL added that its hotel operations in key cities were hit by strong competition, which led to lower room rates and occupancy.
It said sales for its property developments overseas were strong, and it anticipates the segment to start contributing profit later this year.
Quarterly earnings per share came in at 11.6 cents, lower than the 13.5 cents in the previous year, while net asset value per share was $9.85 as at March 31, down from $9.89 at Dec 31, 2015.
AT A GLANCE
REVENUE: $723.3 million (-11.2%)
NET PROFIT: $105.3 million (-14.4%)
DIVIDEND: Not applicable
Chief executive officer Grant Kelley said in a statement: "In line with our diversification strategy, we have accelerated the growth of our international property business, and expect the overseas projects to bring in profit from the second half of 2016."
He added that the developer will focus on acquiring assets that "can immediately contribute to our recurring income, and we will continue to seek attractive overseas investment opportunities".
CDL also announced the acquisition of its first office building redevelopment property in Britain for £37.4 million (S$74 million).
The six-storey Development House in Shoreditch - north of the City of London - can be redeveloped into a nine-storey office block with retail space on the ground floor.
CDL now has 14 overseas development projects - in Australia, China, Japan and Britain.
CDL said in the stock exchange filing that it is preparing to launch its 174-unit freehold condominium Gramercy Park in Grange Road.
"This coveted development is on an expansive site of about 170,000 sq ft, which is rare in today's marketplace," it said, noting that it is increasingly difficult to secure prime land of such scale and, "if available, the asking price for land alone is exorbitantly high".
It added that it was fortunate to have secured this site in the earlier years, which has allowed it to price the homes at "current market rates". Gramercy Park units are said to be effectively offered at about $2,600 per sq ft.