CapitaLand Limited’s Latest Earnings: Growth in Profits Seen

Property giant, CapitaLand Limited (SGX: C31), announced its second-quarter earnings for 2017 (2Q 2017) this morning. The financial period was from 1 April 2017 to 30 June 2017.

Here’s a quick rundown on the financial figures from the latest quarter:

1. Revenue for the quarter came in at S$992.4 million, down 12.3% year-on-year. This was largely due to lower contribution from development projects in Singapore, which was slightly offset by higher contribution from development projects in China and higher rental income from newly acquired/opened properties.

2. Profit After Tax and Minority Interests (PATMI) for 2Q 2017 was at S$579.3 million, a 97% rise as compared to 2Q 2016. The improvement was on the back of improved operating performance as well as higher portfolio and revaluation gains from the investment properties portfolio.

Excluding any gains from divestments, revaluations and impairments, PATMI for 2Q 2017 went up by 20.5% year-on-year to $206.8 million. The better showing was largely attributed to higher contributions from development projects in China, and newly acquired properties in Japan and the US.

3. Consequently, diluted earnings per share (EPS) for the quarter was at 12.5 Singapore cents. This was a vast improvement from 2Q2016’s figure of 6.5 cents.

4. As at 30 June 2017, CapitaLand had S$9.62 billion in net debt, an increase from the S$10.06 billion in net debt that it had on 31 December 2016.

5. Net asset value per share was at S$4.16, as at 30 June 2017.

6. Cash flow from operations was at S$585.6 million for 2Q2017, a decrease from 2Q2016’s cash flow from operations of S$600.9 million.

For CapitaLand Singapore, revenue for 2Q 2017 declined 34.8% year-on-year to S$246. 3 million. This was primarily due to “lower revenue contribution from Sky Vue and Cairnhill Nine since both projects obtained TOP in 3Q 2016 and 4Q 2016 respectively. The decline was partially mitigated by revenue recognition for Victoria Park Villas”. As for CapitaLand China, revenue rose 29.1% year-on-year to S$338.1 million.

No dividend was declared for the quarter, similar to last year.

Looking ahead, Mr Lim Ming Yan, President & Group Chief Executive Officer of CapitaLand Limited, said:

“We will continue to reconstitute our portfolio by realising value of optimised assets and to redeploy capital to higher yielding assets and ventures. The positive momentum of our mall’s network expansion as well as Ascott’s global platform will provide key data points on the flow of people, businesses and capital for us to make major capital deployment decisions.”

Shares of CapitaLand opened at S$3.78 this morning. This translates to a price-to-book ratio of 0.91 and a dividend yield of 2.6%.

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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 Sudhan P doesn’t own shares in any companies mentioned.