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Metro Holdings Q1 net profit halved on lower fair-value gains

MAINBOARD-LISTED Metro Holdings on Tuesday posted a 47.5 per cent drop in first-quarter net profit to S$10.6 million on the back of lower fair-value gains from investments and weaker contributions from joint ventures. 

Earnings per share for the quarter ended June 30 was 1.3 Singapore cents, down from 2.4 cents for the same period a year ago. 

This came as fair-value gains on Metro's investments sank 75.2 per cent to S$1.7 million.

In addition, the share of results of joint ventures more than halved to S$7.3 million, mainly due to losses incurred from The Crest condominium in Singapore and the absence of a S$2.3 million gain from the sale of Acero Works, an office building in the UK, which was recognised in the previous year.

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Revenue for the quarter rose 85.4 per cent to S$55.9 million although cost of revenue also surged 74.6 per cent to S$51.7 million. 

As part of its outlook, Metro said occupancy at its recently acquired 50 per cent stake in two Grade A office towers at Tampines Regional Centre stands at 90.6 per cent and is poised to benefit from increasing demand in the decentralised office market.

Metro chairman Winston Choo said the group will "continuously exercise astute judgement in capital recycling and look out for attractive investment opportunities".

"The group's recent expansion to Chengdu is an excellent example of acquiring a quality asset, in this case, a 25 per cent equity interest in a prime commercial mall within a landmark mixed-use development, with the potential to improve returns through active asset management and tenant mix restructuring," he said.