CapitaLand's 3Q earnings up 28% to S$317 mil on higher one-off gains

By PC Lee / The Edge | November 8, 2017 4:14 PM SGT
CapitaLand reported a 28.1% rise in 3Q earnings to $317 million from a year ago as higher other operating income. This brings earnings for the nine months ended Sept to $1.3 billion, up 68.9% from last year.
Other operating income surged tenfold to $264.5 million on fair value gains arising from Golden Shoe Car Park, the serviced residence component of Funan integrated development in Singapore and Citadines Biyun Shanghai in China, as well as portfolio gains arising from Wilkie Edge in Singapore, CapitaMall Anzhen in China and the 60% stake in CapitaLand Vietnam Commercial Fund I.
Revenue in 3Q rose 9.7% to $1.5 billion mainly from higher contribution from development projects in Singapore, higher rental revenue from newly acquired or opened shopping malls and serviced residences, as well as the consolidation of revenue from CapitaLand Mall Trust, CapitaLand Retail China Trust and RCS Trust from 3Q.
However, operating PATMI in 3Q decreased by 18.8% to $204.5 million, mainly due to lower handover of residential projects in China, and impact of divestment of certain commercial assets in Singapore.
CapitaLand says residential sales remained stable in Singapore with 108 units sold for 3Q, bringing the total number of residential units sold year to date to Sept to 293 with a sales value of $1.15 billion. This included units at Cairnhill Nine, which is fully sold as at July 2017, and Victoria Park Villas, which is 86% sold as at Sept 30.
In China, 100% of the 45 units launched at Skyview at Raffles City Hangzhou and 99% of the 535 units launched at The Metropolis in Kunshan were sold in 3Q.
The launch of d’Edge in Ho Chi Minh City, Vietnam also received strong response, with close to 100% of the project sold in less than two months after sales began in July.
In its outlook, CapitaLand expects residential property market sentiment to improve, underpinned by increased buying volume and a rise in home prices. The group says it will continue to adopt a disciplined approach and source for well-located sites to build its residential pipeline.
In China, CapitaLand expects a slower pace of sales growth for the rest of 2017 as property cooling measures on home purchasing and mortgage restrictions start to have some impact on the residential market.
Shares in CapitaLand closed 4 cents higher at $3.72 on Tuesday.