The Covid-19 pandemic may have brought about strict social distancing measures, especially during the circuit breaker, but that has not deterred real estate agency PropNex from marketing and selling properties.
Although showflats were closed during the circuit breaker, PropNex embraced digital platforms to reach out to consumers and managed to capture about 53% of the market share. It closed 1,369 units in the new launches segment, based on 63 active projects that the group was marketing since the beginning of the circuit breaker to July 31.
In its latest 1H20 results, PropNex recorded a 160.2% surge in earnings to $14.8 million, from $5.7 million in 1H19.
This came on the back of a 45.2% increase in revenue to $241.5 million from $166.3 million a year ago.
On a quarterly basis, 2Q20 earnings came in at $7.3 million, 96.1% higher than $3.7 million last year, with revenue increasing by 15.0% y-o-y to $105.9 million.
The increase in revenue for both the 1H20 and 2Q20 period was attributed to the increase in commission income from project marketing services driven by higher number of transactions completed during the respective periods, following the recovery of the private residential market from the property cooling measures of July 2018.
With cost of services increasing by 42.6% y-o-y in 1H20 to $213.9 million, gross profit for the first half of FY2020 ended June was 69.9% higher at $27.6 million from $16.3 million a year ago.
As at end-June, the group’s cash and cash equivalents stood at $99.7 million.
The board has also declared an interim dividend of 1.5 cents per share, higher than 1.25 cents paid out in the same period a year ago. The interim dividend will be paid on Sept 3.
Ismail Gafoore, co-founder, executive chairman and CEO of PropNex says, “During these unprecedented times, PropNex has remained steadfast in using all its resources to support our colleagues, salespersons, customers and the community. We also remain invested in technology and innovation which will allow us to grow and better serve our customers.”
“The Covid-19 pandemic had undoubtedly accelerated a paradigm shift in the way we operate. We are seeing the trend of buyers becoming more comfortable with online transactions. This will likely make real estate transactions more efficient, as buyers can narrow down the plethora of choices through virtual viewings, and thereafter only conduct physical viewings of their top picks. We are also currently enhancing our investment in digitalising more of our business processes, such as building up an improved digital database for the resale and leasing segments to enhance service quality,” adds Gafoore.
With the anticipated line-up of another 29 projects with a total of more than 9,670 units to be rolled out in the subsequent quarters, PropNex has been appointed for 15 projects to-date.
Shares in PropNex closed flat at 54 cents on Aug 12.
