CapitaLand posts 73.8% jump in Q4 net profit

CapitaGreen in Singapore (left) and Feliz en Vista in Ho Chi Minh City, Vietnam.
CapitaGreen in Singapore (left) and Feliz en Vista in Ho Chi Minh City, Vietnam.PHOTO: CAPITALAND

SINGAPORE - Property developer CapitaLand posted a 73.8 per cent jump in net profit to S$430.5 million for the fourth quarter from S$247.7 million a year ago, driven by better operating performance, higher fair value gains on revaluation of investment properties and lower impairments.

Revenue for the quarter rose 6.5 per cent to S$1.85 billion, mainly due to higher contribution from development projects in China and serviced residences business, partially offset by lower contribution from development projects in Singapore and the shopping mall business, the company announced on Wednesday (Feb 15).

CapitaLand's two core markets of Singapore and China accounted for 87.2 per cent of group's revenue.

Operating profit grew 16 per cent to S$289.1 million, primarily due to higher contributions from development projects and shopping malls in China, partially offset by lower development profits from Singapore.

For the full year, net profit rose 11.7 per cent to S$1.19 billion from S$1.07 billion a year ago. Operating profit improved 27.8 per cent to S$834.8 million from S$653 million a year ago, driven by higher handover of residential units in China and higher recurring income from CapitaGreen in Singapore and its shopping mall business in China.

A dividend of 10 Singapore cents a share for FY2016 has been recommended, compared with 9 cents for the FY2015.

For FY2016, CapitaLand sold a record total of 12,789 homes. In Singapore, the group sold 571 residential units (FY 2015: 244 units) with a sales value of S$1.42 billion (FY 2015: S$559 million).

The group also achieved a second consecutive year of record residential sales in China, with 10,738 units sold at a value of RMB18.1 billion or about S$3.7 billion (FY 2015: 9,402 units; RMB15.4 billion). These represent year-on-year increases of 14 per cent and 17 per cent respectively in terms of units and value.

Chairman Ng Kee Choe said, "CapitaLand has remained resilient and delivered a good set of results for the financial year. Nonetheless, we face an uncertain and unpredictable operating environment and economic headwinds in Singapore and China, our core markets."

Mr Lim Ming Yan, president & group CEO, said Singapore and China will continue to be CapitaLand's core markets, while it scales up in markets such as Vietnam.


Raffles City Hangzhou, China. PHOTO: CAPITALAND

In China, CapitaLand has over 8,000 launch-ready units and expect to hand over 6,000 units in FY2017, said Mr Lim. For its integrated developments in China, the four operating Raffles City projects continue to generate steady leasing income, while the three Raffles City projects opening in 2017 have achieved good leasing progress of more than 80 per cent for the respective retail components, he added.

The group has also begun to manage shopping malls on behalf of third party owners.

"On top of being a new source of revenue... this also allows the group to build a pipeline of quality malls for potential future acquisitions," said Mr Lim.