Property giant CapitaLand has reported a net profit drop of 36.6 percent to S$294 million in Q2 2016, due to lower fair value gains from revaluation of properties, partially mitigated by improved operating performance.
However, group revenue rose 9.7 percent to S$1.131 billion on higher contributions from development projects in China and Singapore, as well as higher rental income from its serviced residence business and higher contribution from its CapitaGreen office development.
Residential sales that contributed to the group’s higher revenue during the quarter included Cairnhill Nine in Singapore, The Paragon in Shanghai and Vermont Hills in Beijing.
Launched in March this year, the Cairnhill Nine development in the Orchard area has sold 78 percent, or 208 of the total 268 units to date.
Despite the muted residential market in Singapore, CapitaLand found buyers for 304 homes during the first half of 2016, or nearly three times the 106 units sold during the same period last year.
The developer recently opened a private preview for Victoria Park Villas, a 109-unit landed housing development at Coronation Road, to gather interest from prospective buyers. At a results briefing on Thursday (4 August), Wen Khai Meng, CEO of CapitaLand Singapore, said there are plans to officially launch the project after the Ghost Month.
In China, the group sold 6,273 homes in the first six months of the year, up 50 percent over the same period last year. For the second half of 2016, CapitaLand has more than 3,000 launch-ready units.
It will also start handing over around 9,000 sold units with a total value of about RMB13 billion (S$2.6 billion). CapitaLand noted that at least 60 percent of the said value is expected to be recognised in H2 2016.
Overall, the group has already sold more than 7,000 homes this year with a total sales value of nearly S$2.62 billion.
Looking ahead, CapitaLand President and Group CEO Lim Ming Yan said: “We will maintain our focus on our core markets of Singapore and China and the growth markets of Vietnam and Indonesia, as well as our serviced residence global platform.
“In addition to capital recycling and portfolio optimisation, we will also leverage our fund management platform and management contracts to grow our assets under management.”