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Roxy-Pacific Q3 net profit up on lower costs, expenses

ROXY-PACIFIC Holdings saw its net profit soar to S$4.4 million for the third quarter ended Sept 30, up from S$1.6 million a year ago, due to much lower cost of sales and expenses.

However, revenue fell 69 per cent to S$18.8 million, mainly due to lower contributions from the property development and property investment segments.

Earnings per share stood at 0.33 Singapore cent, up from 0.12 cent previously.

No dividend was declared for the quarter.

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In Q3, the revenue from the group's property development segment made up 26 per cent, but decreased 90 per cent to S$4.8 million from a year ago.

The decrease was largely due to lower revenue recognition from Trilive, which obtained its temporary occupation permit in June 2018 and absence of revenue recognition from Jade Residences, Whitehaven and LIV on Wilkie following the completion of these projects in 2017.

This was partially offset by higher revenue recognition on construction progress and sales of The Navian and Straits Mansions.

Its hotel ownership segment contributed 64 per cent to the group's turnover in Q3, registering S$12 million in revenue as compared to S$10.9 million a year ago. The increase was mainly due to contribution from Noku Osaka which was acquired in October 2017 and higher revenue from Noku Maldives after its full operation in August 2018.

Revenue from the property investment segment contributed S$1.9 million as compared to S$2.9 million a year ago. The decrease was mainly due to the sale of 59 Goulburn Street in October 2017, partially offset by revenue generated from NZI Centre which was acquired in December 2017.

The group currently has seven development sites in Singapore as its land bank, of which it plans to launch one development site for sale in 4Q2018 and another three development sites in 1Q2019.

In Australia, the group has entered into an agreement to acquire a property in New South Wales, which comprises a mix of warehouse and office space. This marks the group's foray into Australian industrial investment, from which it plans to develop light-industrial warehouses and self-storage units.

However, it noted that pre-sales for the New World Towers project in Brisbane, in which the group has a 40 per cent stake, have been stagnant after achieving 122 units sales during the Phase 1 launch.

Given the existing weak residential market fundamentals in Brisbane, the joint venture parties are currently reviewing the various options for the 435-unit project, including delaying its subsequent launches, said Roxy-Pacific.

In its outlook, the group said that it will continue to exercise prudence in new site acquisitions in Singapore as well as closely monitor market conditions for its planned upcoming launches.

The group also intends to continue to grow its presence and investment portfolio in Australia.