Company Briefs: Hong Leong Finance

Hong Leong Finance

Hong Leong Finance on Thursday posted a 1.5 per cent rise in net profit to $26.2 million, while revenue, measured by its total interest income and hiring charges, rose 18.4 per cent to $95.2 million for its first quarter ended March 31.

The financial services arm of Hong Leong Group said its interest income and hiring charges were driven by loan growth and a higher average loan yield.

But interest expense, including interest on lease liabilities, rose 42.3 per cent due to a larger deposits base and higher funding cost, which led to a smaller magnitude of increase in the company's bottom line. Earnings per share was 23.54 Singapore cents, compared to 23.22 cents a year ago.

Allowances for loans and other financial assets for the first quarter were net recoveries of $349,000, arising from higher bad debts recovered and lower expected credit loss allowances for non-credit impaired loans.

Net loan assets stood at $10.4 billion as at end-March 2018.

The group said some loans were not disbursed in the quarter due to delays in the legal process. Deposits and balances of customers amounted to $11.4 billion as at end-March, up 0.5 per cent from a year ago.

First Sponsor

Mainboard-listed First Sponsor's wholly owned subsidiaries have on April 25 entered into a definitive conditional sale and purchase agreement (SPA) to buy a mixed use development site in China's Guangdong province, at a preliminary price of 404 million yuan (S$81.7 million).

First Sponsor will acquire the entire stake in Concord Focus Development, which owns the development site comprising three land parcels with a total site area of 36,405 square metres, the Singapore-based property developer said on Thursday after market close.

The site has a gross floor area of about 76,570 sq m, said First Sponsor's press statement on Thursday announcing its first-quarter results.

First Sponsor's subsidiaries - FS Dongguan No 9 Investment Consultancy and Wenjiang (BVI) Limited - entered into the SPA with Concord, three individuals who together own all of Concord's shares, as well as Dongguan Kanghe Property Management Consulting Services, which is Concord's wholly owned subsidiary which develops residential and commercial properties.

Under the SPA, Wenjiang (BVI) will pay a preliminary price of 404 million yuan on the completion date of the acquisition. First Sponsor plans to look for a third party as one of the other buyers, subject to the group retaining a controlling stake in Concord after acquisition.

A version of this article appeared in the print edition of The Straits Times on April 27, 2019, with the headline 'Company Briefs'. Print Edition | Subscribe