THE Straits Trading Company on Tuesday posted a net profit of S$17.3 million in the first quarter, up 78.1 per cent from the same period a year earlier as earnings across all its business segments rose.

The biggest boost came from the real estate business, where net profit rose to S$12.4 million in the three months ended March 31, up from S$8.8 million in the same period a year earlier. Property revenue more than doubled to S$9.5 million as additions to the overseas portfolio led to an increase in rental income. 

The group's property portfolio comprises its investments in Straits Real Estate, Suntec Reit and ARA Asset Management.

The tin mining and smelting segment turned a net profit of S$1.3 million, up from S$772,000 in the same period a year earlier, due to better yields from tin smelting and higher profits from the sale of by-products. This was despite a 15.1 per cent fall in revenue to S$101.4 million as the group sold a lower quantity of refined tin.

The hospitality segment, which comprises investments in Far East Hospitality Holdings and Far East Hospitality Trust, also posted higher earnings, lifted by fair-value gains from the group's holdings in Far East Hospitality Trust units.

Executive chairman Chew Gek Khim said: "Following our record performance last year, Straits Trading has started 2019 on a strong footing... Together with Malaysia Smelting Corporation (MSC), we are exploring avenues to unlock the development potential of the freehold Butterworth land, which we believe will be a key future catalyst for us."

MSC, the group's 54.8 per cent-owned resource arm, continues to face challenging market conditions due to volatility in both the foreign exchange and global commodity markets, but has improved its performance in the first quarter, the group said.

MSC also expects its new Pulau Indah smelter to be fully operational by 2020, which will significantly enhance recovery yields and reduce manpower costs, the group added.

The group said: "2019 is set to be yet another challenging year as geopolitical uncertainties and unease over the state of the global economy continue to cast a shadow on the business environment. However, there remain pockets of opportunities for us to capture.

"We will be cautious and especially selective with our investment opportunities. We will continue to take a disciplined approach in making investments with a deliberate longer-term view, which may result in slightly more muted returns in 2019."

Earnings per share was 4.2 Singapore cents, up from 2.4 cents in the first quarter last year.

Net asset value per share was S$3.62 as at March 31, up slightly from S$3.60 as at Dec 31 last year.

The counter fell three Singapore cents or 1.37 per cent to S$2.16 on Tuesday before the results were released.