KepLand mulls over cutting home prices if market falls

[reporter2]

http://www.straitstimes.com/premium/...falls-20130124

KepLand mulls over cutting home prices if market falls

Published on Jan 24, 2013

By Melissa Tan


THE boss of property developer Keppel Land has flagged a possible cut to its home prices if the market falls away in response to the Government's recent cooling measures.

"We will monitor the market... If the market comes down and we can't sell our projects, then we'll have to cut prices," said recently installed chief executive Ang Wee Gee.

He was speaking at a briefing yesterday, where the firm announced a 39 per cent decline in full-year net profit to $838.4 million a year earlier.

But turnover for the 12 months to Dec 31 was largely flat, dipping 1.1 per cent year on year to $938.9 million.

For the fourth quarter, net profit slid a steeper 55.4 per cent to $527.3 million on a 25.8 per cent jump in turnover to $471.9 million.

The drop in full-year earnings was largely because of a record net profit for full year 2011 due to a one-time gain from its $480.3 million sale of its stake in Ocean Financial Centre.

Excluding gains from divestment and revaluation, the firm's net profit was $451.5 million for the full year.

This is 61.4 per cent higher than the $279.7 million net profit excluding divestment and revaluation gains in 2011, Keppel Land said in a statement.

A strong performance from property trading helped to cushion the net profit decline. Net profit from this segment shot up 68.5 per cent to $323.9 million for the year.

Keppel Land cited stronger earnings from projects such as Reflections at Keppel Bay and Marina Bay Suites.

Mr Ang, who took the reins at the start of this year, said at the briefing that a 622-unit condominium it is developing in Sengkang, The Luxurie, has only eight unsold units left.

The Luxurie accounted for the bulk of the 430 residential units Keppel Land sold in Singapore last year.

Mr Ang also disclosed that Keppel Land was in the midst of designing a residential site at New Upper Changi Road next to Tanah Merah MRT and design work for another site at Keppel Bay was "at an advanced stage".

It would "monitor the market closely for a suitable time" to launch those two projects, Mr Ang said.

About half of the developer's total assets are in Singapore and 35 per cent are in China, where Keppel Land sold 1,650 homes last year.

Earnings per share were 55.5 cents for the year, down from 93.8 cents in 2011. Net asset value per share was $3.99 as at Dec 31 last year, up from a restated $3.74 as at Dec 31, 2011.

Keppel Land proposed a final dividend of 12 cents per share.

Its counter closed five cents higher at $4.06 yesterday.

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[ekl2ekl2]

Wow, first time in a while that we hear developers saying directly that they are going to cut prices if market comes down.

Would be interesting to see if people still cheonging at their projects now.

[reporter2]

http://www.todayonline.com/business/...ad-keppel-land

Tough year ahead: Keppel Land

SINGAPORE — Keppel Land plans to review residential launches in Singapore in the light of the Government’s recent round of extensive property cooling measures, while also noting that it expects 2013 to be another challenging year.

The property developer made the comments as part of its results statement which showed that fourth-quarter net profit fell 55.4 per cent, mainly due to the absence of one-off gains.

Net profit for the three months ended Dec 31 was S$527.3 million, down from a restated S$1.2 billion a year ago.

Profit before divestment and revaluation gains was S$157.1million, a 39.9-per-cent on-year gain, it said.

The fourth-quarter results pushed Keppel’s full-year net profit to S$838.4 million, a 39-per-cent fall from 2011’s record net profit.

But without the divestment and revaluation gains, net profit went up 61.4 per cent to S$451.5 million.

Commenting on the results, Chief Executive Ang Wee Gee noted that although 2012 was a year of global economic uncertainty, Keppel Land performed “creditably”.

He also said that Singapore and China will continue to be the company’s core markets, and there is long-term potential in both.

“The stringent cooling measures introduced by the respective governments in these two countries will prevent asset bubbles from forming and support the sustained and healthy development of these markets,” he said.

He added: “We will continue to actively seek good sites with strong marketing attributes for development in these markets.”

Following the divestment of Ocean Financial Centre, the company has S$1.6 billion in cash, and this puts it in a strong financial position to capitalise on the current uncertain business climate to acquire attractive projects in the region.

“As one of Asia’s premier property companies, we will leverage our regional market knowledge, experience and track record to overcome difficulties and seize opportunities,” said Mr Ang.

[hyenergix]

"A strong performance from property trading helped to cushion the net profit decline. Net profit from this segment shot up 68.5 per cent to $323.9 million for the year."

"Keppel Land cited stronger earnings from projects such as Reflections at Keppel Bay and Marina Bay Suites."

"... The Luxurie, has only eight unsold units left."

Trying not to alarm MND...