Wheelock's Q1 Profit Drops 33.9% To $16.9m

Source : The Business Times, May 15, 2008

WHEELOCK Properties Singapore yesterday posted a 33.9 per cent year-on-year drop in first-quarter net earnings to $16.9 million but said that it is in a strong financial position to take advantage of opportunities that may arise. It had cash and cash equivalents of $616.9 million at March 31, 2008, up from $557.7 million at end-2007.

The bigger kitty was due mainly to sales proceeds received from development projects and the sale of 34 Grosvenor Square in London.

Investments in Wheelock's balance sheet fell to $344.6 million at March 31 from $523.5 million at end-2007, mainly because of a slide in the market value of investments in Hotel Properties Ltd and SC Global Developments. The decrease was charged to the fair value and revaluation reserve. However, Wheelock said that the total market value of the group's investments is above the original cost.

Q1 revenue slipped 31.1 per cent to $64.8 million. Wheelock attributed the lower top and bottom lines primarily to lower contributions recognised from units sold at The Sea View and The Cosmopolitan condominium developments. 'This was partly offset by revenue and profit recognition in respect of units sold in Ardmore II in the current period and gain on disposal of 34 Grosvenor Square,' it said. The Grosvenor Square property comprises three floors of a leasehold building in London.

This financial year the group will recognise the remaining profits from The Sea View and The Cosmopolitan on completion of these two projects. 'We will continue to recognise profits from Ardmore II based on the progress of construction works,' it said.

Wheelock also said it has sold more than 70 per cent of the units at Scotts Square, achieving an average price of $3,994 psf. Wheelock expects to sell the remaining units progressively over the next two years. Scotts Square is slated for completion in 2011.

Orchard View is expected to be completed and launched in 2009. Ardmore 3 is also expected to be launched next year.

The first phase of The Sea View received a Temporary Occupation Permit (TOP) last month. TOP for Phase II is expected in mid-2008. The Cosmopolitan, on the corner of River Valley and Kim Seng roads, is expected to be ready in Q3 this year.