SINGAPORE (Oct 28): Ho Bee Land’s chairman and CEO Chua Thian Poh has acquired 16,500 shares on Oct 10, at an average price of $2.30. The purchase, made through an entity called Ho Bee Holdings, brings the total shares held by HBH — which is 82.5% owned by Chua — to 497,932,900 shares.
Chua has been on a buying spree since the middle of last month. Prior to this round, the last series of purchases by him were made in July last year.
On Sept 18, Chua acquired 181,100 shares, paying a total of $413,791.77. On Sept 20, he bought 50,500 shares and on Sept 24, another 35,200 shares. On Oct 7, he bought 100,700 shares.
Chua paid around $2.30 each for these shares, less than half the company’s net asset value. As at June 30, Ho Bee’s NAV was $4.89 a share, down from $4.94 as at Dec 31, 2018.
With the most recent purchases on Oct 10, Chua owns 75.0637% of Ho Bee. In September last year, UOB analysts pointed to Ho Bee as a candidate for potential real estate investment trust and privatisation, with a sustainable 4% yield.
On Aug 6, Ho Bee reported earnings for 2Q2019 ended June 30. Its net profit after tax and non-controlling interests was $14.4 million, which is 80% lower than the same period last year.
In its announcement, Ho Bee attributed the y-o-y decline in net profit mainly to the company’s share of losses from associates and jointly controlled entities amounting to $6.7 million, compared with share of profits of $28.3 million in 2Q2018.
For 1H2019, the company’s share of losses from associates and jointly controlled entities amounted to $2.7 million compared with share of profits of $58.5 million in 1H2018. Additionally, it says the decline in net profit was due to a fair value gain of $28.3 million recorded in 2Q2018, in respect of its leasehold interest in a petrol station site on Bukit Timah road.
However, revenue increased 21% to $52.6 million, up from $43.4 million in 2Q2018. Ropemaker Place, a London investment property that was acquired on June 15, 2018, contributed to the y-o-y increase in rental income during the quarter. Coupled with positive rental reversions at The Metropolis in Singapore and other London properties, rental income for the quarter registered strong growth of 30%.
Ho Bee’s earnings per share for the period amounted to 2.16 cents. Total shareholders’ funds as at June 30, 2019 was $3.2 billion, representing an NAV of $4.89 a share. Net gearing was 0.7 times as at June 30.
Ho Bee sees a subdued outlook, citing the ongoing geopolitical tensions, trade conflict and Brexit uncertainty. The Ministry of Trade and Industry recently pegged Singapore’s full-year growth at between 0% and 1%, with growth expected to come in around the midpoint of the forecast range.
