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SINGAPORE: CapitaLand, Southeast Asia's biggest real estate company, reported higher than expected quarterly net profit on Tuesday, Feb 22, although the number was 41% down from a year ago due to smaller one off gains.
The company's results come on the back of concerns that China and Singapore's recent measures to curb rising real estate prices may hurt its sales.
CapitaLand shares fell 1.5% to S$3.31 (RM7.89) in early trade, and have lost 9.4% since the start of the year, underperforming the Straits Times Index's 3.7% loss.
However, traders said the share price decline in Tuesday's morning session was in line with weakness in the broader market due to concerns about political risk in Libya and China's tightening policy.
"On the residential side, the sales recognition for their China properties were a little slower although they sold quite a substantial number of units there," said Donald Chua, an analyst at CIMB Research, of Capitaland's result.
"The main issue going forward is whether they will delay the launches of their Chinese properties given the weaker sentiment there."
CapitaLand, about 40% owned by Singapore state investor Temasek , said it plans to launch more homes and malls in Singapore and China.
"We target to build 10,000 to 15,000 homes a year over the next three to five years," Liew Mun Leong, President and CEO of CapitaLand said in a statement.
It also plans to launch 1,700 homes in Singapore and about 4,000 in China, he added.
"In 2011, CapitaMalls Asia targets to invest another S$2 billion in new shopping malls in Singapore, Malaysia and China, to augment our 91 shopping malls in Asia Pacific," Liew said.
The company said it earned S$522.1 million net profit in the fourth quarter, 41% lower than S$885.7 million a year ago due to smaller one-off gains.
CapitaLand's net profit in the last three months of 2009 were boosted by the near US$2 billion (RM6.1 billion) initial public offering of its shopping mall arm CapitaMalls Asia .
However, its profit excluding revaluations and impairments was S$301.6 million, higher than the S$190.9 million average estimate of five analysts polled by Reuters.
CapitaLand said it booked portfolio gains of S$194.2 million in the fourth quarter from the divestment of its stake in its Chinese property Raffles City Changning and the sale of 28 properties to its serviced residence unit Ascott Residence Trust. — Reuters
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