CapitaLand Q4 profit almost doubles; buys UK business park for £126.7m

PROPERTY giant CapitaLand's net profit almost doubled to S$926.6 million for its fourth quarter ended Dec 31, 2019, from S$475.7 million a year ago.

The company on Wednesday also announced it has acquired a prime freehold business park in the UK for a total consideration of £126.7 million (S$222.4 million). Arlington Business Park is located in Theale, Reading and comprises 11 Grade A office buildings totalling about 367,000 square feet of net lettable area.

CapitaLand said in a filing that the 94.8 per cent rise in net profit for the quarter was mainly due to better operating performance, higher gains from asset recycling and revaluation of investment properties.

Earnings per share stood at 18.4 Singapore cents for the quarter, up from 11.4 cents a year ago.

Revenue for Q4 rose 46.3 per cent to S$2.38 billion, from S$1.62 billion a year ago, mainly due to the consolidation of Ascendas-Singbridge and Raffles City Chongqing, as well as higher contributions from Singapore and China malls and lodging properties in the US.

The company has proposed a final cash dividend of S$0.12 per share for the full year, unchanged from a year ago. The date payable and books closure date will be announced at a later date.

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For the full year ended Dec 31, 2019, net profit was up 21.2 per cent to S$2.14 billion, while revenue was up 11.3 per cent to S$6.23 billion.

On outlook, CapitaLand said that the Covid-19 situation will have an adverse impact on its operations and trading results - the extent of which will depend on how long the outbreak lasts.

The group said it remains positive on the long-term fundamentals for Singapore and China. It added that its current priority is to ensure the well-being of its staff, tenants and patrons. "We will proactively manage our business and take the necessary actions to ensure that our long-term business prospects going forward remain robust," CapitaLand said.

At the Q4 results briefing, CapitaLand group chief executive Lee Chee Koon said customers are once again going shopping, with foot traffic especially in the suburban malls almost back to normal. It is about 5 per cent down from before the Covid-19 outbreak, Mr Lee noted.

On Wednesday, the group also announced a pay cut for board members and senior management, as well as a wage freeze for all staff at managerial level and above, as "a show of togetherness and solidarity" with stakeholders amid the virus outbreak.

Shares of CapitaLand closed at S$3.72 on Tuesday, up S$0.05 or 1.4 per cent.