Wheelock Properties posts 63% drop in profit; MCL Land reports loss of $165m
EARNINGS at property developers here have sunk like a tonne of bricks as confidence in the residential property market continues to take a beating.
Wheelock Properties yesterday reported a 63 per cent drop in full-year net profit for last year, while MCL Land sank deep into the red, reversing a healthy bottom line a year earlier.
In view of the poor market, Wheelock Properties says it is 'currently reviewing the building plans' for its proposed luxury project Ardmore 3, while MCL Land is reviewing 'the carrying value of development properties for sale in Singapore'.
For the year ended Dec 31 last year, Wheelock Properties posted a net profit of $100.9 million, down from $273.5 million, even though revenue rose 19.4 per cent to $454.6 million. The previous period was nine months due to a change in the company's year-end.
The company attributed the higher revenues to the sale of units at Scotts Square as well as higher rental rates accrued by Wheelock Place, the group's office and retail property in Orchard Road.
Although the depressed residential market here meant prices of freehold non-landed private prime homes fell 14 per cent in the last quarter, the group sold 13 units in Scotts Square last year for a revenue of $54 million, or $4,028 per sq ft, it said.
Total sales for the project have now reached $903 million, and 'this revenue will be recognised progressively in the accounts until Scotts Square is completed' next year.
Wheelock Place was also revalued - from $700 million to $790 million - last year.
Earnings per share were 8.44 cents, down from 22.86 cents the previous year.
Net asset value per share stood at $1.72, down from $1.82 a year earlier.
The board has proposed a final dividend of six cents a share.
MCL Land reported a net loss of US$107.3 million (S$165 million) for the year ended Dec 31 last year, after posting a net profit of US$61.9 million in 2007.
The group recorded full-year revenue of US$343.1 million, a 12 per cent drop. This was mainly attributable to the completion of Mera Springs and The Esta.
The group acknowledged that the residential property markets in Singapore and Malaysia 'were difficult due to the damaging effects of the global financial crisis'.
It noted that the prices of high-end condominiums in the prime district fell by 20 per cent to 30 per cent last year, while prices of mid-tier homes in the central areas fell by 10 per cent to 15 per cent.
Still, the group believes it is 'well-placed to weather the difficult economic and market conditions', with 'strong cash flow' generated from the sale of three projects - The Fernhill, Tierra Vue and Hillcrest Villa.
Loss per share was 29 US cents, down from earnings per share of 16.73 US cents the previous year.
Net asset value per share stood at US$1.06 as at Dec 31, down from US$1.42 a year earlier.
The board has recommended a final dividend of 10 Singapore cents per share.
Source: Straits Times, 21 Feb 2009