Starland posts 83% slump in FY2019 net profit of 1.54m yuan

CATALIST-LISTED property developer Starland on Tuesday reported a sharp drop in its full-year profit for the 12 months to Dec 31, 2019, which it blamed on a weak market in China.

Net profit fell 83.2 per cent year-on-year to 1.54 million yuan (S$306,300), as cost of sales ate away at the lower turnover. Revenue was also down by 55.8 per cent to 29.6 million yuan.

Earnings per share slipped to 0.01 yuan from 0.06 yuan previously, while net asset value was 1.01 yuan a share, compared with 1.15 yuan the year before.

Starland attributed the fall in revenue from property sales to a smaller volume of units moved, "largely due to the weak China economy, and also we are at the tail end of the projects".

The property markets in both China and Singapore "are expected to remain challenging", it warned, citing factors such as the Chinese economy, a trade war between Washington and Beijing, and the outbreak of the new coronavirus in China.

But the company said in its outlook statement that it will work to sell its outstanding stock - 19 residential units, 25 commercial units, and 115 car park spaces - in Chongqing and Singapore.

Starland also noted that it recently moved, under a convertible loan agreement, to take a 51 per cent interest in Luminor Capital (Malaysia) Sdn Bhd, which it described as "a continuing part of the group's strategy to venture into the financial solutions business in Malaysia".

The board has recommended a final dividend of S$0.03 a share, unchanged from the year before, with the books closure and payout dates to be announced.

Starland shares last changed hands at S$0.09 in January.