SINGAPORE (Apr 30): Ho Bee Land reported earnings of $27.7 million for the 1Q ended March, 44% lower than the same period last year.
This was due to a drop in the share of profits from associates and jointly controlled entities amounting to $26.3 million.
Revenue increased 7.7% to $52.4 million with strong growth of 36% in rental income to $51,2 million. This was mainly due to rental income from Ropemaker Place, a London investment property which was acquired last June.
Sales revenue decreased 89% to $1.2 million as the group sold a small site in Gold Coast, Australia for A$5.5 million ($5.3 million) and also sold more units in its Australian development projects -- Rhapsody and Pearl -- in 1QFY2018.
Profit from operations increased 31% to $42.1 million.
The group’s share of profits from associates decreased 85% to $4.3 million due to lower sales and profit recognition from the residential development project in Shanghai as the project is almost fully sold.
Earnings per share for the period amounted to 4.16 cents. Total shareholders’ fund as at March 31 was $3.3 billion, representing a net asset value of $5.01 per share. Net gearing was 0.7 times as at end March.
Ho Bee says the Singapore office market remains positive amidst stable demand and tight supply. On the other hand, the residential market is expected to remain challenging because of the cooling measures and the glut of supply.
In the United Kingdom, the uncertainties surrounding the Brexit outcome will continue to weigh on the economy. However, the long tenancies of the leases for Ho Bee’s London properties will buffer it against any short-term negative impact. In the long term, it remains confident of the resilience of the UK economy.
Shares in Ho Bee closed 1 cent higher at $2.55 on Tuesday.
