Ho Bee Posts 297% Jump In Q3 Earnings

Source : The Business Times, November 14, 2007

Revenue up 137.9% due mainly to a 149% rise in development properties' sale

HO Bee Investment, the dominant residential developer at Sentosa Cove, yesterday posted net earnings of $39.27 million for the third quarter ended Sept 30, up 297 per cent from $9.89 million a year earlier.

The jump was on a 137.9 per cent increase in revenue to $129.6 million, due mainly to a 149 per cent rise in the sale of development properties.

The main contributor to revenue was progressive recognition of sales of residential projects such as Coral Island, which obtained a Temporary Occupation Permit in August, Orange Grove Residences, The Coast and Paradise Island.

For the first nine months of this year, Ho Bee's net profit leaped 391.8 per cent year on year to a record $233.4 million, benefiting not only from a 133.8 per cent increase in revenue to $535.4 million but also a $71 million gain in fair-value changes on investment properties.

Chairman and CEO Chua Thian Poh said the group's revenue and earnings for the rest of the year and the next few years will be buttressed by the progressive recognition of income from successful residential projects that have been launched.

In its results statement, Ho Bee said that the recent withdrawal of the Deferred Payment Scheme by the authorities will have an initial impact on prices and demand.

'The group does not anticipate its upcoming residential projects in the Core Central Region, which includes Sentosa Cove, to be adversely affected as underlying demand from both local and foreign buyers is expected to remain relatively strong,' it said.

Mr Chua said that despite good sales, 'we continue to be prudent in the way we conduct our business, always bearing in mind that we have to ensure long-term sustainable growth for shareholders'.

Ho Bee's Q3 earnings per share jumped to 5.33 cents from 1.34 cents in the year-ago period.

Net asset value per share was 102.8 cents at Sept 30, up from 67.9 cents as at Dec 31, 2006. On the stock market yesterday, Ho Bee shares ended one cent higher at $1.78