SINGAPORE - UOL Group's second quarter net profit surged 59 per centto $109.4 million, boosted by higher recognition of revenue from condo project Principal Garden.

Higher contributions from associated companies and fair value gains on investment properties also lifted the bottomline, the company said on Friday.

Revenue climbed by 10 per cent year-on-year to $399.1 million, with property development accounting for 55 per cent of the turnover during the quarter.

UOL said apart from Principal Garden, other residential projects which contributed to revenue included Botanique at Bartley and Riverbank@Fernvale.

Amid aggressive land bids and rising optimism in the property market, UOL warned of a potential disconnectbetween bullish land prices and selling prices.

"On the residential front, our concern is a possible 'disconnect' between the recent

land tender prices and achievable end-sale prices.

"Transaction volume in the residential sector has risen steadily but a sustainable recovery in end-sale prices will depend on the dynamics of economy, supply-demand and the rental market," noted UOL deputy group chief executive Liam Wee Sin.

The firm's hospitality business including management services was mostly flat with the topline at $105.6 million against $106.2 million in the previous corresponding period.

Mr Liam added: "Our hospitality and investment businesses have performed creditably despite challenging conditions. The recent acquisition of a hotel in Melbourne, which is branded as Pan Pacific Melbourne will further strengthen our presence in Australia and our recurring income."

Quarterly earnings per share rose to 13.59 cents, up from 8.64 cents a year earlier. Net asset value per share improved to $10.27 as at June 30, from $10.10 at the end of Dec last year.

Net profit for the first half rose by 30 per cent year-on-year to $189.7 million as turnover increased by 8 per cent to $749.8 million.

UOL shares closed 14 cents higher on Friday to $8.06 before the results were announced.