SINGAPORE (July 27): Property developer Tuan Sing Holdings has reported earnings of $1.8 million for the second quarter ended June, a 64% decline from earnings of $5.1 million in the same period a year ago.
This brings the group’s 1H17 earnings to $7.2 million, down 51% from $14.7 million in earnings for the first half of 2016.
Revenue for the quarter fell 21% to $84.1 million, compared to $106.6 million in the previous year, due to a decrease in sales of its residential development projects.
As its three development property projects – Seletar Park Residence, Sennett Residence, and Cluny Park Residence – had been completed and substantially sold in previous quarters, property revenue fell 56% to $26 from $58.9 million on the absence of contribution from these projects.
Hotels investment revenue was marginally lower at A$27 million ($29.2 million), compared to A$27.5 million a year ago as both Grand Hyatt Melbourne and Hyatt Regency Perth registered a combined 2.7% drop in RevPAR despite higher occupancy rate.
Industrial services reported higher revenue of $37.4 million compared to $27.8 million in 2Q16, mainly attributable to higher activities from Commodities Trading offset partially by the lower activities from Tyre Distribution.
As for the group’s other investments, Tuan Sing’s 44.5%-owned associate, GulTech, reported revenue of US$71.2 million as compared to US$55.0 million in the corresponding quarter last year.
The overall revenue decline was partially offset by lower distribution costs, which decreased 27% to $1 million from $1.4 million a year ago as there were lower promotional and commission expenses for the residential development projects.
Lower administrative expenses also fell 27% to $6.9 million to reflect lower legal fees incurred relating to the termination of the previous main contractor at Seletar Park Residence.
Other operating expenses for the quarter decreased 62% to $0.8 million compared to $2 million a year ago, mainly caused by a decrease in foreign currency exchange losses arising from the depreciation of the USD, as well as lower net allowance for diminution in value for development properties.
Tuan Sing’s earnings per share stood at 0.1 cent for 2Q, down four times from 0.4 cent a year ago, while net asset value per share was 77 cents as at end-June, down slightly from 77.7 cents as at end-2016.
Cash and cash equivalents stood at $112.9 million as at June 30, 2017.
In its outlook, the group says it expects to be profitable for FY17.
The group it has plans to launch its Kandis Residence in 3Q this year, and also intends to develop its recently-purchased vacant lot at No. 1 Jalan Remaja into approximately 100 units of condominium apartments to launch in 2Q18.
It is also currently looking into repositioning its Sime Darby Centre investment into a “hub of activities that can serve the needs of the residential community in the vicinity”.
According to Tuan Sing, the construction of 18 Robinson has been progressing well and is expected to be completed before end-2018 when it will provide a steady stream of income to the group.
Shares of Tuan Sing closed 1 cent higher at 33 cents on Thursday.
