CAPITALAND, South-east Asia's biggest property developer by market value, posted a 44 per cent drop in quarterly net profit as property sales slowed and it had no big one-off gains, but it said the outlook was positive.
'Despite the cautious market sentiments, we have a positive outlook as our business units are competitively positioned and geographically diversified,' CEO Liew Mun Leong said in a statement. CapitaLand, 40 per cent-owned by Singapore sovereign fund Temasek Holdings, earned S$515.2 million ($376.9 million) in April-June, down from S$912.6 million a year ago, when earnings were boosted by unrealised fair value gains in its assets.
Excluding one-offs, net profit for the 2007 second quarter was S$267.2 million.
The economic gloom has triggered a steep drop in the number of home sales, with some analysts predicting house prices will fall by up to 40 per cent over the next three years.
'In such a challenging time, when many companies in the countries we operate in are unable to raise funds, we continue to be able to access the capital markets in view of the group's strong reputation and good financial standing,' Chairman Richard Hu said in the statement.
CapitaLand said it was on track in preparing its first Malaysian retail real estate investment trust (Reit) for launch this year, bringing the number of its listed Reits to six.
CapitaLand earlier this month borrowed US$1.5 billion to fund a residential project in Singapore that it plans to launch for sale in the first half of 2009, in a joint venture with Morgan Stanley Real Estate, Wachovia, and Singapore's Hotel Properties.
For 2008, CapitaLand is expected to post a 64 per cent drop in earnings to S$1.02 billion from S$2.8 billion in 2007, according to the average of 16 analysts polled by Reuters. The 2007 results had included S$1.1 billion in revaluation gains.
CapitaLand earned 61 per cent of its income from Singapore in 2007, while Australia and New Zealand contributed 12 per cent and China added 23 per cent. But analysts are expecting weaker contributions from its Australia and China businesses this year.
No plans to privatise Australand
CapitaLand Chief Executive Liew Mun Leong said his company has no intention to privatise its Australian unit AustraLand.
Speaking to reporters at a results briefing on Friday, he said AustraLand is planning to expand into industrial and logistics properties in Asia, areas where it will not be competing with its parent.
AustraLand, 54 per cent-owned by CapitaLand, earlier this week reported a 79 per cent fall in earnings and announced a rights issue to raise up to A$557 million (US$526 million).
CapitaLand has committed to subscribe to A$302 million in the issue, which could boost its stake in AustraLand to 70 per cent.
Shares of CapitaLand fell 21 cents or 3.7 per cent to S$5.49 in morning trade. -- REUTERS
No comments:
Post a Comment