APAC Realty, which runs the ERA property agency business, has reported earnings of $16.6 million for 1HFY2022 ended June, down 2.8% y-o-y. Revenue in the same period dipped by 4.4% y-o-y to $342.6 million.
The company attributes the performance to a lower volume of resale and rental transactions brokered, down 9.6% y-o-y to $199 million. The resale market saw a total of 7,932 units changing hands, down 21.4% y-o-y.
On the other hand, new sales held up well, with a 4.2% increase in revenue to $139.3 million for this segment over the year earlier 1HFY2021.
APAC Realty notes that as a result of fewer launches, new home sales in the first half of 2022 was down 40.2% y-o-y to 4,546 units.
ERA was given the mandate to market 25 new projects with a total of more than 8,200 units and estimates its market share of new homes sold was 30.6% for 1HFY2022, versus 32.3% for 1HFY2021.
Executive chairman Jack Chua (picture, right), calls the six-month reporting period an “eventful” one. Besides the outbreak of new Covid variants, there’s also geopolitical uncertainty from Russia’s invasion of Ukraine. China’s stringent lockdowns curbed sentiment further.
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“Whilst these factors elevated inflation and interest rate, Singapore’s property market remained relatively healthy underpinned by strong demand from local home buyers and foreign investors,” says Chua.
“Amidst this backdrop, our 8,400 ERA trusted advisors put in a strong performance, allowing us to maintain a healthy 40% share of the market,” he adds, referring to the total of 10,466 transactions clocked for 1HFY2022.
“We are delighted that our ERA trusted advisors have once again turned in a strong performance in spite of the prevailing challenges,” says CEO Marcus Chu (picture, left).
“Our digital first strategy has empowered ERA trusted advisors with leading-edge tools and applications to better serve an increasingly digital and sophisticated customer base – one which demands service excellence and bespoke quality advice,” he adds.
Chu notes that while the Singapore market continues to face challenges of rising interest rates, higher inflation and rising government land sales cost, the Singapore market will remain relatively resilient this year.
“With increasing interest from local home buyers and foreign investors to the Singapore market, demand for quality residential spaces continues to outweigh supply, especially for new homes. We believe that this demand will negate the impact of some of these challenges,” adds Chu.
The company plans to pay an interim dividend of 3.5 cents per share, equivalent to a payout ratio of 75% and translating into an annualized yield of 9.9%.
APAC Realty has an existing dividend policy of distributing between 50 and 80% of its earnings every half year.
APAC Realty shares closed at 69 cents, down 2.84%.
