SINGAPORE (Feb 26): City Developments Limited (CDL) this morning announced that its 4Q19 earnings have increased by 12.5% to $87.7 million from $77.9 million a year ago. This brings 4Q19 earnings per share to 9.0 cents, 13.9% higher than 7.9 cents in 4Q18.
Revenue for the fourth quarter ended Dec came in at $946.9 million, 20.1% higher than $788.3 million last year, with increased contribution across all business segments.
Property development segment was backed by several Singapore projects including The Tapestry, Whistler Grand and Amber Park, as well as the fully sold 32 Hans Road project in the UK. The inclusion of W Singapore – Sentosa Cove into the group’s hotel portfolio in 2Q19 bolstered the increase for the hotel operations segment.
Furthermore, the acquisition of UK’s Aldgate House and 125 Old Broad Street (OBS) in late 2018 boosted the investment properties segment for 4Q19 revenue.
Gross profit margin achieved for 4Q19 was 45%, lower than the comparative period of 55%. This was due to lower profit margins for recently launched Singapore residential projects vis-à-vis higher contribution by high margin projects, of which revenue was fully recognised on handover in 4Q18.
As cost of sales increased by 48.2% y-o-y to $521.2 million, 4Q19 gross profit came in at $425.7 million, 2.5% lower than $436.6 million in 4Q18.
On a full-year basis, FY19 earnings increased marginally by 1.3% to $564.6 million from $557.3 million in FY18. Revenue for the full year ended Dec was 18.8% lower y-o-y at $3.4 billion, while gross profit was 14.4% lower y-o-y at $1.6 billion.
The group and its joint venture (JV) associates sold 1,554 units including executive condominiums in Singapore with a total sales value of $3.3 billion in FY19, representing a 40% increase in units sold and a 49% increase in sales value achieved, as compared to 1,113 residential units with a total sales value of $2.2 billion in FY18.
Meanwhile, the group's wholly-owned subsidiary CDL China Limited and its JV associates sold 526 residential units and four villas in China, achieving sales value of RMB1.81 billion ($350 million) in FY19. Over in Australia, CDL sold over 60% of its JV 195-unit freehold residential project The Marker in West Melbourne. In addition, the Group’s collaboration with Waterbrook Lifestyle Resorts for the 135-unit retirement village project in Bowral commenced pre-sales towards the end of 2019. Over 50% of the initial 52 units launched received reservations.
As at end Dec, the group’s cash and cash equivalents stood at $2.8 billion.
The group has declared a final ordinary dividend of 8.0 cents per share, as well as a special ordinary dividend of 6.0 cents per share. Including the interim dividend of 6.0 cents paid out in Sept 2019, the total FY2019 dividends amount to 20.0 cents per share, unchanged from the total dividends declared in FY2018.
Kwek Leng Beng, executive chairman of CDL says, “The privatisation of M&C in 2019 is a transformative milestone for CDL and in line with our focus to enhance recurring income. The roadmap for M&C is being formalised with priority initiatives to drive operational efficiency, sustainable hotel performance and integration with the Group. These initiatives will take time to materialise but the efforts lay the foundation for CDL’s growth.”
“The Covid-19 outbreak is one of the biggest disruptors that has created a thick cloud of uncertainty, placing the global economic and social resilience to the test. The situation remains fluid and the full impact on businesses, operations and supply chains is still unknown. Nevertheless, we view the outlook for 2020 with an optimistic prism. With the collective efforts from government, businesses and individuals, the situation will stabilise and recover in time,” he adds.
Sherman Kwek, group CEO of CDL says, “2019 has been a bumper year for CDL with a record of six residential project launches in Singapore that registered healthy sales. We completed around $2.3 billion of acquisitions and investments both in Singapore and our key overseas
markets, including the successful takeover and privatisation of M&C. On the asset management front, Republic Plaza’s AEI achieved positive rental reversions and we are progressing forward with other AEIs in order to derive greater value from our assets."
As at 10.30am, shares in CDL are trading 2.06% lower at $10.44.
