Frasers Centrepoint full-year profit up 15% on higher revenue, fair value gain

Artist's impression of The Courtyard which connects the North and South Wings of Northpoint City.
Artist's impression of The Courtyard which connects the North and South Wings of Northpoint City.PHOTO: FRASERS CENTREPOINT

SINGAPORE - Higher revenue and fair value gain on investment properties lifted results for Frasers Centrepoint Limited (FCL) in its 2017 financial year.

Net profit rose 15.4 per cent to S$689.1 million from S$597.2 million in the previous year, the group said in a Singapore Exchange filing on Friday morning (Nov 10).

The firm recorded a S$215.3 million in fair value gain on investment properties, about double the S$106.3 million in the previous year.

It also made an exceptional loss of S$15 million - compared with a net gain of S$4.6 million last year - due to transaction costs on the acquisition of subsidiaries.

Excluding both fair value change and exceptional items, profit attributable to shareholders stood at S$488.2 million.

For the year ended Sept 30, revenue grew 17.1 per cent to S$4.03 billion from the previous year, on the back of increased contributions from the group's Australia and international businesses.

Earnings per share grew to 21.48 Singapore cents from 18.38 Singapore cents in the preceding year.

FCL has proposed a final ordinary dividend of 6.2 Singapore cents, unchanged from the previous corresponding period.

Looking ahead, FCL said it will continue to grow its portfolio in a prudent manner across geographics and asset classes.

Panote Sirivadhanabhakdi, group chief executive of FCL, said FY2017 has been a "fruitful year" for the group as it focused on growing its overseas income and building up a defensive portfolio of quality, income-producing assets in markets which it is familiar with.

"Our recent acquisitions of four business parks in the UK and Geneba Properties, an Amsterdam-headquartered company which has a portfolio of long-lease, industrial and logistics assets in Germany and the Netherlands, are testaments to our efforts," he said.

"This has also enabled us to reshape FCL's portfolio, from one that had nearly 70 per cent assets in Singapore and nearly 60 per cent in property development five years ago, to a diversified, balanced portfolio today, with nearly 60 per cent of assets outside Singapore, and over 80 per cent of assets in recurring income sources."

This strategy will enable the group to remain resilient amid market and geopolitical uncertainty, and over shortened real estate cycles, he added.

FCL said in the media release: "The group will also look at opportunities to optimise capital productivity and unlock value from its portfolio of investment properties via asset enhancement and repositioning initiatives, as well as the injection of stabilised assets into its real estate investment trusts."

The group's net-debt-to-equity ratio rose to 70.6 per cent as at Sept 30, 2017 from 64.4 per cent as at Sept 30, 2016.

Over the same period, net asset value per share increased to S$2.46 from S$2.30.