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Mapletree group's FY16 profit slips 3.8% to S$965.2m (Amended)
LOWER revaluation gains led to a 3.8 per cent drop in Mapletree Investments' net profit for the financial year ended March 31, 2016.
While profit after tax and minority interests (Patmi) slid to S$965.2 million, recurring Patmi rose 11.7 per cent from a year ago to S$529.4 million on the back of strong operating performances from the group's existing assets and its four listed Reits, leasing contributions from new assets, and higher fee income.
Recurring Patmi made up 54.8 per cent of overall Patmi in the fiscal year ended March 31, 2016, as compared with the historical five-year average of 39.9 per cent.
"Over the remaining three years, we want to continue growing our recurring earnings so that it will account for most of PATMI," said Mapletree group CEO Hiew Yoon Khong. "This will provide strong cash flow, strengthen our business and ensure that Mapletree delivers consistent earnings and returns."
Returns remain strong, with a return on equity of 9.6 per cent for the year and 10.2 per cent on average over two years.
On the whole, Mr Hiew said the group is pleased with the performance despite an economic slowdown in its core market Asia. "Importantly, we set out to raise the proportion of recurring earnings when we embarked on our new five-year business plan in FY14/15, and we have made strong progress towards that objective in this second year of execution."
Revenue grew 15 per cent to S$1.9 billion on the back of contributions from the group's assets in its new markets of Australia, the United States and Europe; contributions from SC VivoCity, the group's first mall in Vietnam; and properties held under its Reits.
As at March 31, assets under management grew by S$6.3 billion from a year ago to S$34.7 billion, with the group's investments in new markets accounting for close to half of this increase.
The group remains keen on investing in modern logistics real estate projects as well as office and residential developments in select cities in China, Mr Hiew said.
In Vietnam, there are "interesting opportunities" given the significant increase in office demand from new and existing companies expanding their presence and the strong momentum in residential sales.
In the original headline, we had given an incorrect FY16 profit figure due to an editing error. The headline has been changed to reflect the correct figure.