Property developer CapitaLand has announced that its net profit for the nine months ended 30 September 2010 increased 4 percent to S$751.1 million, driven by higher development profits, divestment gains and fair value gain on investment properties.
Excluding the impact of impairments and revaluations, net profit for the first nine months also rose 20 percent to S$542.4 million over the same period last year, while revenue jumped 6 percent to S$2,245.8 million. This was mainly attributed to increased revenue from Australia, higher rental income from serviced residence operations and higher contributions from development projects in Singapore and Vietnam.
With the divestment of four malls in Singapore and Malaysia to CapitaMall Trust and CapitaMalls Malaysia Trust, rental income from shopping malls has dropped. However, Group Earnings before Interest and Tax (EBIT) for the nine months reached S$1,558.8 million, up 3 percent over the same period last year. The strong EBIT growth was largely attributed to fair value gain from the revaluation of investment properties in China, the United Kingdom and Australia, as well as to higher development profits from projects in Singapore and Vietnam.
Dr. Richard Hu, Chairman of CapitaLand, said the group “focused on executing its long-term growth strategies. In the third quarter, the Group has again strengthened its financial flexibility with the issue of an aggregate S$1 billion of bonds, demonstrating an ability to take advantage of conducive market conditions to tap the bond market. With the increased financial capacity, we will seek new investments and take advantage of strategic opportunities. CapitaLand Group is on track to accelerate the growth of its key businesses in the core markets of Singapore, China, Australia and Vietnam.”
Mr. Liew Mun Leong, CapitaLand’s President and CEO, also said: “We will execute our growth strategy in all our businesses and across the respective core markets. We have set up a new business unit, CapitaValue Homes, to meet the real, non-speculative demand for affordable homes in China and Vietnam.”
“In Singapore, we plan to have the proposed development at Farrer Road and The Nassim launch-ready by the fourth quarter of this year. In the Singapore office sector, robust economic growth continues to drive demand and rents for prime commercial space,” he added.