Ho Bee Land's net profit up 115% on increased profits from associates

Singapore

MAINBOARD-LISTED developer Ho Bee Land's net profit for the half-year ended June 30 was up 115.4 per cent at S$90.6 million on the back of increased profits from associates and jointly-controlled entities.

The share of profits from associates was S$31.3 million, compared with a loss of S$407,000 a year ago. The group recorded share of profits from the Shanghai and Zhuhai associates due to units that were sold prior to the pandemic.

Share of profits from jointly controlled entities was S$3 million compared with a loss of S$2.3 million a year ago, mainly due to higher profits from the Seascape and Cape Royale developments in Sentosa Cove and the residential development project in Tangshan.

Ho Bee Land's revenue for the period inched up 1.7 per cent to S$108.8 million as rental income increased 2.2 per cent to S$107.3 million. The group saw positive rental reversions when leases were renewed for the investment properties in Singapore and London.

No sales of development properties was recorded. A year ago, the group posted S$1.8 million in revenue from these sales.

Ho Bee Land booked a gain of S$5.7 million in foreign exchange, compared with a loss of S$3.6 million previously. This was mainly due to the revaluation of its net monetary assets in the Australian dollar and euro, as both currencies appreciated against the Singapore dollar.

Staff costs and directors' remuneration increased 38.2 per cent to S$10.4 million mainly due to the hiring of a new team based in Gold Coast, Australia since Q4 2019.

Direct rental expenses were 23.6 per cent lower at S$7.3 million. The group received a refund of about £500,000 (S$899,547) of business rates from UK tax authorities, and recovered property tax expenses of about S$0.6 million. It also incurred higher rent commission expenses a year ago due to the timing of lease renewals at The Metropolis and Turquoise in Singapore.

Earnings per share was 13.62 Singapore cents, compared with 6.32 Singapore cents a year ago.

Net gearing was 0.65 time as at June 30.

Ho Bee Land said that due to the pandemic, the business outlook is grim and uncertain as countries continue to be in a lockdown or partial lockdown mode and are susceptible to waves of infection outbreaks.

Chua Thian Poh, chairman and CEO of the group, said: "In the midst of the Covid-19 pandemic, we are fortunate to have a portfolio of prime offices in Singapore and London, as these offices remain 100 per cent occupied. Our recurring income base has contributed to the resilience of the group during these challenging times."

The counter closed at S$2.02 on Thursday, up S$0.02 or 1 per cent, before results were out.