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Fragrance's fiscal 2019 profit tumbles 70.1% to S$79.9m

MAINBOARD-LISTED Fragrance Group posted a 70.1 per cent drop in net profit to S$79.9 million for the full year ended Dec 31, 2019, from S$267.2 million a year ago.

The property developer posted a drop in revenue but recorded S$99 million in other operating income, according to a regulatory filing on Tuesday.

Other operating income was mainly from a fair value gain on an investment property, a gain on the settlement of financial liabilities, a gain on the disposal of financial assets, and on bank balance denominated in foreign currency, as well as higher interest income recognised, which was partly offset by a loss on forward foreign exchange contracts.

Earnings per share stood at 1.184 Singapore cents for the year, down from 3.97 cents a year ago. 

Revenue for the fiscal year fell 82.2 per cent to S$58.2 million, from S$326.2 million a year ago.

The company said that the City Gate development project in Singapore was the main revenue contributor for its property development segment. The development obtained its temporary occupation permit in November 2018.

Fragrance added that it did not recognise revenue from ongoing projects, which are mainly in Australia, as revenue from these projects will be recognised on a completed contract method upon completion.

It has declared an interim cash dividend of 0.35 Singapore cent per share for the full year, up from 0.2 Singapore cent a year ago.

The dividend will be paid on March 17, subject to shareholders' approval, after the March 10 record date.

On outlook, the group is expecting the overall market for residential properties to remain competitive with developers launching more projects in the near term. Furthermore, take-up rates for private residential units had fallen quarter on quarter in Q4 2019. It added that it has two development projects, Jervois Treasures and Urban Treasures, in Singapore which are in early stages of development. 

Its Australia projects, Premier Tower and NV Apartments, are ongoing and revenue from these projects will be recognised upon completion and the settlement of sale contracts. Depending on the level of settlement and the completion of Premier Tower's construction, the group is expecting to recognise the revenue from these two projects in fiscal 2020 and 2021.

The Covid-19 outbreak may also impact the sale of units in the group's development projects and hotel operations in the next few quarters, Fragrance added.

Fragrance shares closed flat at S$0.137 on Tuesday.