Weaker sales of homes have affected earnings of Keppel Land, resulting to 38.8 percent drop to $36.9 million in its net profit for Q1.
Revenue was much affected, dropping 46.6 percent to $145.7 million.
Overseas sales accounted for 25.5 percent of Keppel Land’s net profit in Q1, down by 28.7 percent last year.
The company’s lower profit contribution in property trading was partly alleviated by higher earnings in fund management activities and property investment.
Due to effect of the global downturn to housing demands in Singapore and the rest of the region, developers are having a hard time.
Yesterday, Keppel Land said it would continue monitoring major risks that can affect it and ‘take the necessary actions to mitigate or eliminate them’.
The developer will phase or defer its developments for maximising project returns and managing capital requirements. Keppel Land has already halted the development of Madison Residences and Marina Bay Suites in Singapore.
It also announced that 15 units had been sold from its Park Infinia condo at Wee Nam, which was completed this year and priced at $1,200 per square feet. Another 15 units from The Tresor in Duchess Road was sold at $1,300 per square feet.
According to lodged caveats, Park Infinia offered units at $1,300 to $1,600 per square feet last year, while The Tresor offered at $1,842 per square feet.
The Governments’ flash estimate showed that prices of private homes in Singapore dropped by 13.8 percent in Q1.
In the office rental sector, where there was a fast plunge in rents, occupancy of office buildings from Keppel Land slightly plunged to 94.6 percent, though its portfolio rent was high. All of Marina Bay Financial Centre was pre-committed by 61 percent.
Regarding its overseas sales, Keppel Land said it was high in China but low in Vietnam, India, and Indonesia due to uncertainties in the market.
Keppel Land’s earnings per share were down to 5.1 cents from 8.4 cents last year, while its net asset value per share was up to $3.50 from $3.39 by last year’s end.
Yesterday, its shares closed at $1.76, which is down by three cents.