Allgreen 2009 profit more than doubles

ALLGREEN Properties posted a more than doubling in full-year net profit, helped by firmer sales and a higher provision write-back.

The property developer said net profit for the year ended Dec 31, 2009 stood at $163 million, up from 2008’s $67.4 million. This translates to earnings of 10.23 cents per share, against 2008’s 4.24 cents.

It has also proposed a first and final dividend of four cents per share.

Revenue – which came mainly from the sales of development and investment properties – surged 75.5 per cent to $621 million.

Sales from the company’s development properties segment more than doubled to $468 million in 2009 from $186 million the preceding year. This was after recognising income from projects such as The Cascadia at Bukit Timah Road, Cairnhill Residences at Cairnhill Circle and Blossoms@Woodleigh.

Revenue growth from its investment properties was nearly flat, falling 0.44 per cent to $111 million, impacted by reduced room rates and lower occupancy at Traders Hotel. This was offset by higher occupancies and rental rates at Tanglin Mall and Great World City’s retail space. Allgreen registered a 62.2 per cent decrease in ‘other operating expenses’ to $17.4 million. It said there was no need to make provisions for a ‘diminution in value of development properties’.

It had made about $24.6 million in provisions for a lowered value for development properties a year ago. The year 2009 also saw a $66.3 million write-back of provision for diminution in value of development properties. As the write-back is a non-taxable income, it resulted in a lower effective tax rate for 2009.

The developer posted a fair value loss of about $6.09 million, reversing from a gain of $8.35 million a year ago, due to lower valuation of Great World City’s office space. Updating on its recent launch, the developer said thus far it has sold 74 units of its 83-unit Holland Residences, which was launched on Jan 25.

‘Brisk sales at good prices in these early days of 2010 suggest the market remains buoyant against the backdrop of improving economies locally and internationally,’ the firm said in its financial statement.

Allgreen shares closed flat at $1.12 yesterday.

Source: Business Times, 26 Feb 2010