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UOL Group Double Its Net Profit In First Quarter

UOLLogoUOL Group (SGX: U14) is the property arm of the United Overseas Group of Companies. The company is involved in both local and international property development and investments. It currently owns 43.4% of United Industrial Corp (SGX: U06) which owns almost four-fifths of Singapore Land (SGX: S30). UIC is currently in the process of trying to take Singapore Land private. Both Singapore Land and UIC are also real estate plays. UOL Group announced its first quarter earnings on 7th May 2014.

Operating Result

Revenue increased to S$ 408.8million for the quarter which is a 65% improvement year on year. This is mainly due to the asset sale in Kuala Lumpur Malaysia for S$ 218.5million. Without the one off land sale, revenue for the group actually reduced by 23.2% to just S$ 190.3million. Revenue from property investment increased by 16% to S$ 48.7million while revenue from its hotel ownership and operations improved 8% year on year to S$ 107.2million. This was mainly due to the opening of PARKROYAL on Pickering since January 2013. The revenue from hotel and other management services stayed relatively similar to last year at around S$ 4.9million.

Profits from associates also improved about 10% year on year to S$25.2million. This is mainly from the higher contribution from United Industrial Corp’s Pan Pacific unit and Marina Centre Holdings. Its net profit attributable to shareholders increased by 69% year on year to S$ 120.8million. However, S$ 44.3million of it is due to the one off gain from the land sale in Malaysia.

On its balance sheet, its gearing ratio improves to 24% as the group paid down its debt. However, the group has about S$ 475million worth of unsecured notes due within these two years.

Foolish Summary

No dividend has been declared for the quarter. UOL Group ended the trading day on 7th May 2014 at S$ 6.48 per share. Its net tangible asset per share is at S$ 8.90, giving the company a Price to Book ratio of 0.73 times.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Stanley Lim doesn’t own shares in any companies mentioned.