Aspial swings back into the black in Q2

ASPIAL Corporation posted a net profit of S$5.9 million for its second quarter of the year, compared to a loss of S$6.5 million a year ago.

Revenue doubled to S$212.3 million in Q2 from S$104.6 million, buoyed by its real estate business. This was mainly attributed to the progress recognition of sales from CityGate and revenue from the settlement and handover of completed residential units for Avant and Australia 108 projects in Melbourne, Australia.

Earnings per share for the first half of the year was 0.70 cent, up from a loss of 0.01 cent previously.

A dividend of 0.25 cent was declared.

Looking ahead, the group expects CityGate to contribute to the group's revenue and profit in FY2018 as it continues to record sales for the remaining commercial units and construction progresses on schedule to obtain TOP in 2018.

In Australia, the group said that it has made good progress for their Australia 108 and Avant projects.

In the next 12 months, the group will continue with the sale of Nova City project and intends to launch Albert Street project in Brisbane subject to market conditions in Brisbane then.

In Penang, Malaysia, the group has completed the refurbishment, upgrading and building works of 16 properties. It has started hotel operations at some of the completed properties and has received positive business and reviews to date, said Aspial.

At current market prices, the group expects to make substantial profits from its ongoing development projects in Singapore and Australia. The real estate business is expected to contribute significantly to the group's revenue and profitability from FY2018 to FY2020.

As part of its strategy to improve its debt position, the group intends to use part of the cash proceeds to purchase some of its remaining term notes and bonds, which may include those due in 2018, 2019 and 2020, prior to the maturity dates of these notes and bonds.

"The purchase of its term notes and bonds may be done via various channels such as open market purchase and tender offer and will enable the group to improve its debt position and reduce negative carry," said Aspial.