Earnings of Tuan Sing Holdings surged 15-fold to $100.7 million in 1HFY21 ended June, from the $6.6 million posted in the year before thanks to strong revenue across all business segments.
On a fully diluted basis, earnings per share was 8.5 cents, compared to 0.6 cents in 1HFY20.
With this, net asset value per ordinary share came in at 105.2 cents on June 30, compared to 97.7 cents on Dec 31.
Revenue for the first six months of the year expanded by 57% y-o-y to $143.9 million.
Revenue from real estate investments was up 7% to $28.3 million due mainly to higher occupancies at 18 Robinson and Link@896 as well as higher average gross rental for Link@896. This helped to offset lower contributions from Robinson Point which was disposed on June 7.
Real Estate Development saw revenue jump by 78% to $55.9 million thanks to higher progressive recognition of units sold at Mont Botanik Residence.
Despite the global restrictions, revenue from the hospitality segment was up 24% to $25.8 million largely due to Hyatt Regency Perth’s quarantine business and the fact that Grand Hyatt Melbourne stopped operations between mid-April and mid-November in 1HFY20.
Revenue from industrial services came in at $35.6 million, up $20.8 million due mainly to higher sales from coal.
Cost of sales was up 60% y-o-y to $107.8 million, while gross profit came in 48% higher at $36.1 million in line with the higher revenue.
Other operating income rose by $87.8 million to $93.3 million in 1HFY21, mainly attributable to a disposal gain on an indirect wholly owned subsidiary in Singapore and partially offset by lower Covid-19 related government grant income
Distribution expenses was up 112% to $5.4 million mainly due to higher sales commission expenses and show flat costs relating to the sale of residential properties in Singapore.
Administrative costs were up 11% to $16.9 million while other operating expenses shrank by 69% to $0.3 million in line with the drop in government grant income.
The group also recorded a higher share of results of equity accounted investees of $17.0 million in 1H2FY21 from $14.3 million in 1H2FY20.
This is mainly attributable to higher net profit contribution from the group’s 44.5% stake in GulTech, which rose 19% to $16.9 million on the back of higher revenue and an increase in scrap sales income.
As at June 30, Tuan Sing’s cash and cash equivalents stood at $250.0 million, compared to $108.3 million a year ago.
“While the road towards a full post-pandemic recovery remains uncertain, we are confident that our strong foundation will allow us to thrive in this challenging period,” CEO William Liem says in the group’s results filing.
He adds that the group remains unflinching in its focus on core property segments and “will continue to seek opportunities and explore potential partnerships and collaborations to grow our portfolio of well-located assets in tourism gateway cities, as well as strengthen our commercial portfolio in the region as we transition into a regional real estate player”.
All units were sold at its Kandis Residence, which obtained the temporary occupation permit (TOP) for in March.
Over at Mont Botanik Residence, sales have been performing well with a healthy uptick in units sold.
The group will be commencing the sale of Peak Residence following the recent soft launch.
Liem remains positive on buying sentiment in the residential property segment on the back of a low interest rate environment and ample liquidity in the market, despite concerns over higher construction costs and the tight manpower situation within the sector.
Meanwhile, the group’s investment properties in Singapore have been seemingly unscathed by the pandemic. Its flagship building Link@896 has undertaken asset enhancement works which is expected to improve the group’s recurring income.
Over in Australia, the group is banking on the renewal and extension of tenancies at its properties in Melbourne and Perth to rake in stronger returns in 2021 and beyond.
In Indonesia, the group is actively developing Batam Opus Bay, a 125-hectare integrated mixed development township. Sales from the recent soft launches of the residential component - Balmoral Tower and Cluny Villas - have been encouraging despite travel restrictions.
The group is positive on the strong development potential of Batam as a locale for high- quality lifestyle for residents and visitors, given its proximity to Singapore and strong domestic airlinks.
Meanwhile, Tuan Sing’s associate - Gultech China has entered into sale and purchase agreements to divest approximately 2.5% of Gultech Jiangsu to the investment arm of the local authority: Xishan Economic and Technology Development Zone for RMB 83.75 million recently.
The move is part of a broader restructuring of Gultech Jiangsu’s shareholding capital and positions the company for a possible listing in China.
The divestment will allow the group to monetise part of its longstanding investment in Gultech and is in line with its plan to strengthen its balance sheet and focus on its core real estate business in the region.
Gultech China and Gultech Jiangsu will remain as associated companies of the group upon completion of the proposed transactions.
Shares in Tuan Sing closed up 2 cents or 3.81% at 54.5 cents on Aug 6, before its results announcement.
Cover image: Tuan Sing Holdings
