GL's profit hit by declines in hotel, property development

Declines in its hotel, gaming and property development segments have hit earnings at GL, formerly known as GuocoLeisure.

The firm reported yesterday that full-year net profit fell 28 per cent to US$49 million (S$66 million), compared with the previous year.

Meanwhile, revenue came in 11 per cent lower than before at US$350.2 million for the 12 months to June 30.

The group cited a "challenging" environment for British operations after last year's Brexit vote to leave the European Union.

An improvement in average room rate for hotels was undercut by the pound's slide against the greenback.

Property development revenue was also lower, given that the company had benefited from a land disposal in the previous financial year.

Still, there was better news for the group's oil and gas business, with higher revenue reaped from Bass Strait oil and gas royalties as production increased and the Australian dollar strengthened.

  • AT A GLANCE

  • REVENUE: US$350.2 million (-11%)

  • NET PROFIT: US$49 million (-28%)

  • DIVIDEND: 2.2 Singapore cents (unchanged)

Earnings per share dropped to 3.8 US cents, from 5.2 US cents a year earlier, while net asset value was slightly lower at 80.8 US cents a share, against 80.9 US cents.

A dividend of 2.2 Singapore cents a share was declared, the same as a year earlier.

The group is maintaining a cautious outlook on the British hotel industry.

It noted that a softer pound could boost leisure spending, but would also eat into revenue growth and the carrying value of hotel properties in US dollar terms.

As for the group's oil and gas royalty revenues, it noted that it expected to feel the impact of range-bound oil prices in the global market.

GL shares closed up half a cent, or 0.67 per cent, to 75 cents, before results were announced.

A version of this article appeared in the print edition of The Straits Times on August 26, 2017, with the headline 'GL's profit hit by declines in hotel, property development'. Print Edition | Subscribe