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Roxy-Pacific's Q2 net profit falls 56.7% to S$6.4 million

Lower revenue from its property development businesses dampened results for Roxy-Pacific Holdings in its second quarter.

Net profit plunged 56.7 per cent to S$6.4 million from the previous year, the group said in a Singapore Exchange filing on Tuesday evening.

For the three months ended June 30, revenue fell 52.5 per cent to S$37.0 million from the previous year. In its property development segment, which accounted for 61 per cent of its revenue in Q2, Roxy-Pacific saw lower revenue recognition from Trilive, which got its TOP in June 2018, and an absence of revenue recognition from Jade Residences, Whitehaven and LIV on Wilkie following the completion of these projects in 2017.

This was partially offset by higher revenue recognition on construction progress and sales of The Navian and Straits Mansions, it said. Its hotel ownership segment, which contributed 34 per cent to the group's turnover, registered more revenue this quarter as compared to the same quarter last year.

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The increase was mainly due to contribution from newly acquired hotel in Osaka, Japan and higher revenue from resort in Maldives after its partial opening.

Meanwhile, revenue from its property investment segment declined mainly due to sale of the Sydney office building, 59 Goulburn Street, in October 2017. 

Earnings per share dropped to 0.49 Singapore cents from 1.12 Singapore cents in the previous year. For the first half of the year, net profit fell 35.2 per cent to S$13.4 million from the previous year, as revenue dropped 41.9 per cent to S$83.3 million from the previous year. Earnings per share sank to 1.02 Singapore cents from 1.57 Singapore cents in the previous year. 

Regarding the recently announced cooling measures in the local property market, the group said it will "continue to monitor the market closely in view of its planned upcoming property launches, and continue to exercise prudence in site acquisitions."

Following Roxy-Pacific’s acquisition of a freehold site at 27 Moulmein Rise in May 2018, it currently has eight development sites in its pipeline, of which five are planned to be launched for sale in FY2018, subject to market conditions.“We’ve replenished our sites relatively early into the cycle, before the en bloc fever, at very reasonable prices. Our past track record of successful sales launches in Singapore also demonstrates our ability to launch projects that are well-differentiated, which has been well-received by the market,” executive chairman and chief executive Teo Hong Lim said.

Roxy-Pacific has an accumulated total attributable pre-sale revenue of S$605.0 million, the profits of which will be progressively recognised from Q32018 to FY2021. Net asset value per share slipped to 38.1 Singapore cents as at June 30, from 42.16 Singapore cents in six months ago.It declared an interim dividend per share of 0.195 Singapore cents from 0.214 Singapore cents in the preceding year. Roxy-Pacific shares closed unchanged at S$0.44 on Tuesday.