Year on from family feud, CDL shares jump nearly 5% as 2025 profit triples
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CDL intends to declare ordinary cash dividends at least once a year, with a minimum payout ratio of 35 per cent.
PHOTO: LIANHE ZAOBAO
SINGAPORE – Shares of City Developments Limited (CDL) jumped 5 per cent on Feb 27 after the company said its 2025 earnings had tripled and that it had committed to a formal dividend policy.
The welcome news came after what group chief executive Sherman Kwek described as “a year of reflection, resilience and disciplined execution”, which helped restore market confidence following a 2025 boardroom battle that pitted him against his father, CDL executive chairman Kwek Leng Beng
For the six months ended Dec 31, 2025, the hotel and property group’s net profit soared 374 per cent to $538.5 million from $113.5 million in the same period a year ago. This boosted CDL’s full-year 2025 earnings to $629.7 million, up 213 per cent from $201.3 million in 2024.
CDL declared a final dividend of 25 cents per share, bringing total payout for 2025 to 28 cents, compared with the 10 cents declared for 2024. This represents a dividend payout ratio of 40 per cent.
Going forward, the board intends to declare ordinary cash dividends at least once a year, with a minimum payout ratio of 35 per cent based on reported net profit.
CDL shares rallied on the news, rising as much as 5 per cent to $9.83, before closing up 4.9 per cent at $9.82. Year to date, it is up more than 20 per cent.
The improved earnings were driven by a record $4.4 billion in residential sales from Singapore and strong capital recycling gains.
CDL also undertook about $2 billion of asset sales, including monetising its 50.1 per cent stake in the South Beach mixed-use project,
The transaction was one of CDL’s largest divestments and generated gains of $473.1 million.
Excluding a $155 million impairment for two of its China projects – a Shenzhen business park and a Shanghai commercial project – as well as the divestments, CDL’s 2025 core profit would have been in the range of $100 million.
Mr Sherman Kwek said at a media briefing on Feb 27 that capital recycling activities are core to the group, just as property development and asset management are. “I don’t think it is appropriate to look at capital recycling as a one-off,” he said, stressing that CDL will continue with its efforts to unlock value from mature and non-core assets while selectively redeploying capital to drive growth.
Mr Mervin Song, head of Singapore property research at JP Morgan, estimated that CDL has $5 billion to $6 billion worth of assets that it could sell in three to five years. These include three UK office buildings and a development platform, as well as a global living sector portfolio with total gross development value of $3.7 billion.
For the first six months of 2025, revenue grew 11.1 per cent to $1.9 billion, while full-year revenue expanded 9.7 per cent to $3.59 billion.
Property development was the largest contributor to revenue growth in 2025, jumping 24 per cent from 2024. This was driven by higher contributions from Singapore projects such as The Myst, Norwood Grand, and Union Square Residences, as well as the sale of the Ransome’s Wharf site in London’s Battersea area and the office component of Suzhou Hong Leong City Center in China.
As at end-2025, CDL has cash reserves of $2.1 billion, and cash and undrawn committed credit facilities totalling $4.2 billion.
The robust performance comes a year after the elder Kwek accused his son of an “attempted coup” involving the appointment of new independent directors and cited governance concerns, past investment missteps and “eroded investor confidence”.
The dispute, which triggered a trading halt and raised questions over CDL’s future direction, was eventually defused in March 2025 after senior establishment figures and trusted family friends mediated a truce, and the lawsuit was dropped.
Mr Sherman Kwek said the relationship is now “very cordial and very harmonious among management and the board”. “We did have an internal issue and unsightly public dispute, but as management and board, we are trying to move forward expeditiously so that we can unlock more value from CDL at a quicker pace,” he said.
CDL has engaged an advisory firm to conduct a strategic review of its operations and an investor perception audit to gather feedback.
The group is reviewing its growth strategy, portfolio structures and capital allocation priorities. “I hope by no later than June, we will be able to announce something,” the CEO said.
He is confident about the Singapore residential market for 2026, thanks to stable demand in public and private housing. Buying interest is expected to remain resilient as interest rates ease.
He added that the Government’s review of the income ceilings for Housing Board flats and executive condominiums – to align with rising incomes, inflation and cost of living – could make them more affordable for eligible Singaporeans while sustaining positive market sentiment. The last revision was made more than six years ago.
CDL is preparing to launch its Lakeside Drive project in the third quarter of 2026. It will feature five 17-storey residential towers with 570 units and commercial space on the first storey.
Singapore’s office rental market outlook for 2026 is also positive, supported by limited Grade A supply, said the company.
In terms of its hotel strategy, CDL maintains a twin strategy as an operator and asset owner, said group chief operating officer Kwek Eik Sheng.
Its hotel operations segment reported a pre-tax profit of $256 million for 2025, up from $193.4 million in 2024. This was bolstered by capital recycling gains from the sale of JW Marriott Hotel Singapore South Beach, which was part of the South Beach mixed-use development, and Comfort Inn Near Vail Beaver Creek in the US.
