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UOL Q3 net profit down 85% to S$92.8 million mainly due to one-off gain on consolidation of UIC in Q3 2017

UOL Group posted an 85 per cent decline in third-quarter group net profit to S$92.8 million from S$609.2 million in the year-ago period.

The drop was due mainly to the S$535.6 million gain recognised in Q3 FY2017 upon the consolidation of United Industrial Corporation (UIC) from Sept 1, 2017.

Excluding the one-off gain in Q3 FY2017, net profit rose 5 per cent to S$92.8 million for the third quarter ended Sept 30, 2018, UOL said in a Singapore Exchange filing on Tuesday evening.

Revenue shrank 3 per cent to S$523.8 million from the preceding year.

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The drop was due  to a 43 per cent contraction in revenue from property development to S$165 million from lower recognition from Principal Garden and Botanique at Bartley as the projects approach completion in fourth quarter 2018 and first quarter 2019 respectively as well as the completion of Alex Residences in September 2017. The revenue decline was partly offset by Amber45, which was launched in May this year, and higher revenue from The Clement Canopy project arising from the UIC consolidation.

Revenue from property investments rose 60 per cent to S$132.5 million following the consolidation of UIC’s investment properties and 120 Holborn Island, a London office property. Hotel ownership and operations posted a 26 per cent increase in revenue to S$172.2 million with the inclusion of UIC’s hotels, while revenue from management services and technologies climbed 164 per cent to S$33.7 million, mostly from the technology arm of UIC. The increases arose largely from three months of results consolidated for Q3 FY2018 compared to one month for Q3 FY2017.

Dividend income grew 46 per cent to S$20.4 million with higher dividends from United Overseas Bank in Q3 FY2018.

Earnings per share fell to 11.02 Singapore cents in Q3 FY2018 from 75.25 Singapore cents in Q3 FY2017. Net asset value per share rose to S$11.43 as at Sept 30, 2018 from S$11.23 as at Dec 31, 2017.

The counter ended six Singapore cents lower at S$6.18 on Tuesday.

UOL said that the cooling measures introduced in July have affected sentiment in the Singapore residential property market.  Singapore office rents, on the other hand, are expected to be on the uptrend given the strong demand from a wide range of sectors coupled with limited new supply.