In the annual general meeting of CapitaLand, chief executive Liew Mun Leong said that CapitaLand is expected to get a weaker financial performance this year as compared in 2008.
However, the company’s property group, including its retail, residential and serviced residences division expects a smooth sailing for the company.
“I think that what we have done in the past few years will hold (us) up in 2009 as well,” Mr. Liew said.
He noted that 2009 will be worse compared to 2008 as CapitaLand recorded a $1.26 billion net profit, about 50% lower in 2007.
According to Mr. Liew, the entire business sections should stay profitable this year, with serviced residences and shopping malls under The Ascott Group to raise a good output.
Mister Liew said, “For us, China will be good. I think China will be our saviour,” addressing for company’s China business.
In 2008, 45 percent of the company’s $2.2 billion profit before interest and tax (Ebit) were derived from China and 40% goes to Singapore, the company’s second largest market.
Profit in Singapore for 2009 will be supported by sales from two residential projects: the Orchard Residences with 175 units and the Seafront on Meyer with 327 units.
During the general meeting, one shareholder inquired whether the CapitaLand intends to keep its current dividend levels. Last year, the company paid seven cents per share.
Chairman Richard Hu responded that dividend level for this year will depend on the company’s performance and added that their policy is to preserve sustainable dividend payouts.
Shareholders then asked two important matters: Mr. Liew’s accumulated bonus in 2007 worth $20.52 million and whether CapitaLand plans to return cash to its shareholders.
The company had a total cash of $4.2 billion at the end of 2008 and noted during the update that CapitaLand improved $5.5 billion cash liquidity prior to the current rights issue. A shareholder then asked, “Can you return a few cents back to the shareholders?”
On the renumeration made by Mr. Liew, the company used its indicator for economic value-added (EVA) in calculating his bonus. His 2007 bonus was an incentive for the company’s $2.76 billion profit that year, doubling its earning from $1.01 billion in 2006.
As for our massive war plan, the company will use the amount to “take full advantage of all the tremendous opportunities we will see in the next year or two”, said Olivier Lim, CapitaLand’s chief financial officer.