Guocoland has announced that its net profit for the second quarter ended 31 December 2010 fell 64 percent to S$21.6 million, from S$60.4 million in the previous year, driven by lower gains from Chinese development projects.
Revenue in Q2 also sank 55 percent to S$162.8 million over the same period in 2009. While this meant that net profit was lower in general, the group’s share of profits from associates for the quarter jumped S$5.9 million, largely due to the successful divestment of a penthouse unit by a Singaporean associate firm.
Guocoland’s earnings per share slipped to 2.39 cents in Q2 from 6.8 cents in the previous year, while its net asset value per share also dropped to S$2.14 as of 31 December, compared to the S$2.42 in June.
Guocoland said it saw higher profit from development projects in Singapore, as the construction of Sophia Residence, Elliot at the East Coast and Goodwood Residence got underway. However, China’s performance dwindled from the strong base of the comparative period in the previous year, which had seen the launch of SOHO units in Shanghai GuoSon Centre and Nanjing Ascot Park.
The group still expects continued economic growth in its core markets of China and Singapore, it said in a statement. Governments in both nations are implementing pro-active measures to prevent property markets from overheating; thus, it “remains optimistic on the medium and long-term prospects of real estate investments in both markets”.