UOL managers and above take pay cut to manage costs

PROPERTY developer UOL on Monday announced salary reduction of up to 18 per cent for managers and above, including senior management, effective from April 1, 2020 to help the company manage costs.

This is on top of the deferment of non-essential capital expenditure, initiatives to reduce operating costs across all asset classes, "value-engineering" for project development and asset-enhancement initiatives, as well as the tapping of S$44.8 million in the government's assistance and grants.

In addition, the company disclosed that about a quarter of its retail tenants are operating during the circuit-breaker period. Its retail space committed occupancy stood at 95.2 per cent as at March 31, 2020, unchanged from a year ago, although shopper footfall has fallen 12.4 per cent.

In its hotel portfolio, the owner of the Pan Pacific and ParkRoyal hotel brands said its Singapore hotel occupancy fell to 50 per cent in the first quarter, compared to 85 per cent a year ago; revenue per available room (RevPar) has dropped to S$140, from S$233 a year ago.

Among the assets in its Australia hotel portfolio, occupancy has fallen to 72 per cent from 84 per cent a year ago, while RevPar has declined to S$129, from S$163 a year ago.

On the residential front, UOL has been trying to enhance its digital-marketing efforts through virtual show galleries, digital sales brochures, advertisements, and participation in webinars on digital portals to reach out to potential buyers.

It said that it has achieved virtual viewings and leads from the online exposures, although there has still been a slowdown in transaction volume with showflats being closed during circuit-breaker period.

It continues to register sales for Avenue South Residence and The Tre Ver, especially. In the first quarter, it sold 85 home units in all, compared to 138 in the fourth quarter of 2019.

UOL has net debt of some S$4.2 billion, with an average debt maturity of 1.7 years, but as at end-March 2020, it still held S$722 million in cash, with S$3.2 billion in unused credit facilities.

UOL shares added a cent to S$6.67 on the market on Monday.