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Net fair valuation loss dents Centurion Q4 net profit

CENTURION Corporation posted a lower net profit for the fourth quarter ended December 31, 2016, dented by a net fair valuation loss on its investment properties.

The dormitory operator saw its net profit fall 61 per cent to S$2.9 million, compared to S$7.5 million a year ago. Its investment properties comprising workers and student accommodation assets were fair valued by independent valuers end of 2016, and a net fair valuation loss of S$3.1 million was recognised in Q4 2016, compared to a S$3.6 million net fair valuation gain in Q4 2015.

Revenue grew 23 per cent to S$34.8 million, boosted by its accommodation business. The latter saw a year-on-year revenue growth of 26 per cent, or S$7.1 million. In contrast, its optical disc business saw a decline of S$0.6 million in revenue due to weaker market demand and the cessation of business operations in Indonesia. The optical disc business reported breakeven results for Q4.

For the full year 2016, Centurion's net profit slipped 16 per cent from a year ago to S$28.7 million despite a 15 per cent growth in revenue to S$120.3 million.

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Its balance sheet remains healthy with S$82.5 million of cash and bank balances. Centurion said it would "carefully balance between acquiring operating assets that will contribute to current income, and investing in development projects for sustained future growth" to ensure sustainable growth in the long run.

It added that the outlook for its student accommodation business in 2017 remains positive, underpinned by the high occupancy rates secured for the new academic year.

Centurion has proposed a final dividend of 1 Singapore cent a share, unchanged from a year ago. The planned final dividend, if approved at the Annual General Meeting to be held in April 2017, will be paid on May 19, 2017.