SINGAPORE (July 27): TEE Land posted a 96.4% fall in FY17 earnings to $0.3 million from $8.1 million a year ago, after it sunk into the red in the last quarter.
TEE Land closed 4Q17 ended May with a loss of $1.4 million from $4.6 million in 4Q16 a year ago.
Revenue increased 90.7% to $33.1 million due mainly to higher progressive revenue recognised for development projects, particularly Third Avenue in Malaysia, Hilbre 28 and a new development project, 183 Longhaus in Singapore.
The group also changed its revenue recognition policy for retail units in a mixed use development in Malaysia, from completed contract method to percentage of completion method.
However, cost of sales in 4Q17 correspondingly increased by 126.2% to $25.9 million. Gross margin decreased to 21.8% from 34.0% a year ago due mainly to the higher revenue contribution from development projects in the quarter, which had lower gross margin.
Other operating expenses for 4Q17 included an impairment of completed properties held for sale of $2.9 million.
Share of results of associates for 4Q17 reversed into a loss of $2.3 million from a profit of $6.6 million a year ago due mainly to provision of impairment and expected loss in some of the development projects in Singapore, and the completion of a number of development projects and full recognition of revenue in FY16.
TEE Land expects the property market sentiments in Singapore and Malaysia to remain unchanged. For Thailand, demand for properties is expected to be stable. In Australia, the group will continue to explore opportunities to realise value in its investment in the remaining hotel in Sydney. The rebuilding work in Christchurch is a long-term project by the New Zealand government. Therefore, demand for workers’ accommodation will remain stable.
Shares in TEE Land closed 1 cent lower at 19 cents.
