SingHaiyi's Q3 net profit up 12.8%; revenue more than triples
Singapore
SINGHAIYI Group on Wednesday posted a 12.8 per cent increase in net profit to S$1.4 million for its third quarter ended Dec 31, 2017, as revenue more than tripled to S$41.7 million.
The property developer said the surge in turnover arose mainly from the revenue recognised for its completed executive condominium project, The Vales, as well as sales of completed units from Vietnam Town in the US.
Property development income rose to S$39.2 million, from S$8.9 million a year ago. Cost of sales surged to S$35.8 million, from S$5.9 million a year ago, but the group said this was "in line with the increase in property development income".
In the quarter, the group had secured the bulk sale of Phase II of Vietnam Town, a 141-unit commercial condominium project in San Jose in the US, for US$95.3 million.
It expects to begin delivery of the first block in Q2 2018. The bulk sale is slated for completion by September 2018, and is expected to have a positive impact on the group's net tangible assets and earnings per share for FY19, it said.
Gross profit margin decreased by 37.1 percentage point year-on-year, which it attributed mainly to the change in geographical revenue mix as more revenue from property development with lower profit margins was recognised in the latest reporting quarter.
The developer said that amid the increase in collective purchase activities, comparatively higher prices in the recent government land tenders and the improved sentiment surrounding the residential and commercial sectors, it remains "cautiously optimistic of the outlook for the Singapore property market".
The group recently secured the tenders of the collective purchase of two freehold properties, Sun Rosier at How Sun Drive for S$271 million and How Sun Park for S$81.1 million.
The group further augmented its land bank in January 2018, clinching the collective purchase of Park West, a 99-year leasehold residential property located along Jalan Lempeng in Clementi, for S$840.9 million.
The collective purchases were undertaken through 50:50 joint ventures between wholly-owned subsidiaries of the company and entities controlled by the group's controlling shareholders, husband-and-wife pair Gordon Tang and Celine Tang.
"With these collective purchases, the group has accumulated a fairly large land bank which will give it a clear pipeline of projects over the next few years.
"The group intends to develop these properties into signature residential projects that will offer quality homes that blend in well with the location and cater to market needs," it said.
Its shares closed flat at S$0.115.
