Singapore Land's net profit up 267% to S$331.2m on fair value and disposal gains

REAL estate developer Singapore Land Group's U06 net profit was up 267 per cent to S$331.2 million for the full year ended Dec 31, 2021, largely due to the fair-value gain on investment properties and a one-off disposal gain.

The group said in its financial statement that it is anticipating uneven recovery across the different property asset classes. It also noted that the state of United States-China relations will be an important geopolitical dynamic this year, while the Covid-19 pandemic will continue to have a lingering impact on the global economic recovery.

Fair value on investment properties of Singapore Land came in at S$104 million, while the disposal of its associate, Tianjin Yanyuan International Hotel last November recorded a one-time gain on disposal of S$34.6 million.

This had in part cushioned the 10 per cent dip in revenue to S$ 607.1 million from the S$671.1 million the year before, which was due to a decline in revenue from property trading and technology operations.

Revenue from property trading fell 55 per cent, as there were fewer units sold for the V on Shenton residential project, while the 13 per cent drop in revenue from technology operations was attributed to the global supply chain constraint.

This was, however, partially mitigated by a 19 per cent increase in revenue from hotel operations, thanks to the full year of operations of the Parkroyal Collection Marina Bay hotel.

Earnings per share for the full year came in at 23.1 Singapore cents, versus 6.3 cents the year before.

Net asset value per share as at Dec 31, 2021 came in at S$5.30, up from S$5.12 the previous year.

The board has recommended a final dividend of 3.5 Singapore cents, unchanged from the previous year.

On the outlook for the property segment, Singapore Land said that it is expecting office demand to gain momentum amid a global talent crunch. The office space is increasingly seen as crucial for retaining and recruiting talent, said the group.

Meanwhile, the retail sector is likely to continue to be divergent in terms of performance: suburban malls are expected to outperform city-fringe malls, Singapore Land noted.

The Singapore hospitality sector continues to face significant headwinds, given the reliance on easing of international travel restrictions. Still, the group is bullish that performance of its Tianjin hotel is expected to return to pre-Covid levels with domestic tourism being the key driver.

On the residential front, Singapore Land said that the market is expected to remain stable in 2022.

"With strong underlying demand from owner-occupiers and first-time home buyers, we remain cautiously optimistic regarding sales for new private residential homes," it added.

Shares of Singapore Land ended Tuesday S$0.01 or 0.4 per cent lower at S$2.58.