SingHaiyi reported Wednesday its fiscal fourth quarter net profit jumped 47.6 percent on-year to S$9.7 million on higher margins from U.S. projects and a fair value gain on the 9 Penang Road property.
Revenue for the quarter ended 31 March dropped 67.6 percent on-year to S$9.8 million, the property developer said in a filing to SGX.
That was mainly on lower revenue recognized for its completed executive condominium project, The Vales, and its completed private condominium, City Suites, the filing said. The decline was partly offset by sales of units at a completed commercial condominium project, Vietnam Town phase two, of S$5.8 million, SingHaiyi said.
Property development revenue fell 72.9 percent on-year to S$7.60 million in the quarter, while rental income slipped 1.4 percent on-year to S$1.84 million, the filing said. Management fee income rose 3.4 percent on-year to S$401,000, SingHaiyi said.
However, the gross profit margin rose by 16.6 percentage points on-year, mainly on a shift to more revenue from U.S. property development, it said.
Other income dropped 91.7 percent on-year to S$1.04 million in the quarter on a year-ago write-back of an allowance on development properties, the filing said.
Other operating expenses climbed 30 percent on-year to S$15.62 million on an increased fair value loss on a U.S. investment property due to a challenging retail-market environment with a lower occupancy rate, SingHaiyi said.
The share of results of equity-accounted investees was a gain of S$24.9 million for the quarter, swinging from a year-earlier loss of S$1.9 million, mainly on the share of profit of the 35 percent equity interest in Park Mall, which owns 9 Penang Road in Singapore, SingHaiyi said. The profit was mainly on a fair value gain on reclassifying 9 Penang Road as an investment property, from a development property previously, it said.
For the full fiscal year, SingHaiyi reported net profit fell 20.3 percent on-year to S$22.6 million on revenue of S$460.3 million, down 83.5 percent on-year.
In its outlook, SingHaiyi said it has launched the 250-unit Gazania and the 80-unit Lilium developments earlier this month, with around 15 percent of the 165 units launched so far having sold. It also said it plans to launch the Parc Clematis project in coming months.
It added its 9 Penang Road commercial development has obtained UBS Singapore as its sole anchor office tenant.
“The group remains cautiously optimistic on the property sector, having officially launched its two freehold properties which saw positive demand, with a third well-located property in the pipeline, slated to be launched in the coming months,” SingHaiyi said.
In the U.S., the Vietnam Town project in San Jose, California, is progressing as planned, with selling prices in line with expectations, the company said.
“Trade war tensions and concerns over interest rate hikes continue to plague market sentiment. However, the overall U.S. economy is likely to continue its growth momentum, while demographic trends are expected to support demand for real estate this year,” SingHaiyi said.
It proposed a dividend of 0.15 Singapore cents, compared with 0.3 Singapore cent in the year-ago period.
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