City Developments Limited

City Developments Limited (CDL) delivered an 18.3% increase in net attributable profit after tax and minority interests (PATMI) of S$362.0 million (restated H1 2018: S$306.1 million) for the half year ended 30 June 2019. The increase was underpinned by the successful unwinding of the Group’s second Profit Participation Securities (PPS 2) structure, which achieved pre-tax deferred gains totalling S$153.9 million from the divestment of Manulife Centre and 7 & 9 Tampines Grande and a gain of S$43.3 million from the Group’s stake in PPS 2. Profit from two well-received joint venture projects, South Beach Residences and Boulevard 88, also contributed to the positive results.

As at 30 June 2019, the Group’s balance sheet remained robust, with cash reserves of S$3.3 billion and a net gearing ratio without factoring any revaluation surplus from investment properties of 44%. The interest cover for H1 2019 was 14.4 times. The Board declared a tax-exempt special interim dividend of six Singapore cents per ordinary share, the same as last year. The dividend will be paid on 12 September.

CDL Executive Chairman Mr Kwek Leng Beng said, “US-China trade tensions continue to severely dampen market sentiments globally. Until a deal is struck between the world’s two largest economies, global markets will continue to succumb to trade jitters. Many economies, including Singapore, will be seriously affected by the escalating dispute. Agility, discipline and experience are critical attributes that will enable the Group to navigate through these persistent headwinds in today’s dynamic, disruptive and unpredictable landscape.”

CDL Group Chief Executive Officer Mr Sherman Kwek said, “We have focused on executing our GET strategy of Growth, Enhancement and Transformation. By creating strong value propositions and timing our launches strategically, we have achieved healthy sales for our residential projects in Singapore. At the same time, we have further diversified overseas through transformational initiatives such as our partnership with Sincere to expand CDL’s presence in China and achieve sustainable growth there. Increasing recurring income via acquisitions, asset enhancement initiatives and our fund management strategy is another priority. We will continue to grow, diversify, innovate, transform as well as forge new alliances.”

Please click here for CDL’s full financial statement or here to view the webcast of CDL’s results briefing.

Millennium & Copthorne Hotels plc

Millennium & Copthorne Hotels plc (M&C) recorded net profit rise of 5% year-on-year to £21 million for the second quarter ended June 30. Revenue dipped 1.2% to £257 million, while earnings per share is 6.4 pence, up from 6.2 pence a year ago. Revenue per available room for the quarter under review improved to £85.55. This was up 4.3% in reported currency and 1.1% in constant currency terms. For the six-month period, net profit shrank 21.4% year-on-year to £22 million while total revenue dipped 1% to £472 million.

"Refurbishment at the Mayfair hotel and Orchard Hotel Singapore negatively impacted the group's performance during H1 2019. The Mayfair hotel has been closed since July 2018 and is expected to reopen in September 2019. Orchard Hotel has been closed on a phased basis since Q4 2018 and refurbishment work completed in July 2019. The total impact was a reduction in revenue and profit by £7 million and £6 million respectively,” said M&C.

On June 7, the Board of CDL and M&C’s independent directors announced that they had agreed terms on a recommended pre-conditional final cash offer by CDL for the outstanding shares in M&C not owned by CDL. The final offer document was published and sent to M&C shareholders on 15 August, with a first closing date on 27 September. The cash offer of 685 pence per share was 65 pence higher than the bid announced in December 2017 and later rejected by M&C's minority shareholders.  No interim dividend was declared for the half-year, in line with the terms of the final offer.

Please click here for M&C’s full financial results announcement.

CDL Hospitality Trusts

CDL Hospitality Trusts’ (CDLHT) net property income (NPI) edged up 0.5% year on year to S$33.8 million for Q2 ended 30 June 2019 (Q2 2019), from S$33.6 million a year ago. The increase in NPI was boosted by better performance of Pullman Hotel Munich in Germany and the UK hotels, and inorganic contribution from Hotel Cerretani Florence (acquired in November 2018). However, the growth in NPI was largely offset by the reduction in contribution from Singapore and Maldives, mainly due to extensive room enhancement works at Orchard Hotel in Singapore and the closure of Raffles Maldives Meradhoo for renovation.

Apart from the renovation works affecting the performance of the Singapore hotels, there was also softer overall demand in the Singapore market due to economic uncertainty and regional elections in nearby countries such as India, Indonesia and Australia. The biennial Food&HotelAsia event was also absent this year. NPI contribution from New Zealand and Japan was lower due to competitive trading conditions, while fixed rent from the Australia hotels fell due to a weaker Australian dollar.

Interest expense for Q2 2019 was higher by S$0.9 million mainly due to additional loans to fund the acquisition of Hotel Cerretani Florence, asset enhancement works, as well as higher funding costs on the floating rate loans. Total distribution to stapled securityholders declined 2.6% to S$25.1 million from S$25.8 million a year ago. Accordingly, CDLHT posted a distribution per stapled security of 2.07 Singapore cents for Q2 2019, down 3.3% from 2.14 cents a year ago.

For the half year ended 30 June 2019 (H1 2019) 30, NPI declined 5.4% per cent to S$67.5 million. Total distribution to stapled securityholders was S$50.4 million and DPS was 4.16 cents for H1 2019, a decrease of 2.8% and 3.5% year on year.

Please click here for CDLHT’s full results statement.

Hong Leong Finance

Hong Leong Finance (HLF) posted a net profit after tax of S$52.5 million for the first half of 2019, down 5.2% or S$2.9 million from the same period a year earlier. For Q2, net profit after tax was S$26.3 million, down 11.1% or S$3.3 million over the previous corresponding period.

Net interest income declined 1.3% to S$102.4 million and 5.8% to S$50.9 million for H1 and Q2 2019 respectively. This is driven by higher cost of fund outpacing improved loan yield amidst the competitive interest rate environment. Net interest margin was down by 9 and 14 basis points (bps) respectively.

Net loan assets grew 9.2% to S$11.224 billion as at 30 June 2019. Earnings per share was 23.55 Singapore cents, down from 24.88 Singapore cents in H1 last year. An interim dividend of five Singapore cents will be paid on 11 September, the same as last year.

With the U.S. Federal Reserve rate cut by 0.25%, HLF said it will continue to monitor future interest rate movements and its implications on Singapore’s rates to package deposits. The company also said it is reviewing the recent Monetary Authority of Singapore announcement to issue up to five new digital bank licences and exploring ways to participate in this transformation journey and to remain relevant.

Please click here for HLF’s full financial statement.

Hong Leong Asia

Hong Leong Asia (HLA) posts Q2 net profit of S$8.36 million for the second quarter ended June 30. This was compared with the net loss of S$33 million in the year-ago period, which included a S$36.6 million loss from discontinued operations of its consumer products unit Xinfei.

Net profit from continuing operations was up 11% to S$36 million for Q2. Revenue for the quarter also rose 9.6% to S$1.09 billion, due mainly to higher revenue from its China diesel engines unit Yuchai and its building materials unit. Yuchai's revenue rose 10.9% to S$94.9 million, while building materials revenue was up 6.4% to S$6.9 million.

Earnings per share for the quarter were 1.12 Singapore cents, compared with a loss per share of 8.81 cents in the year-ago period. No dividend was declared, the same as a year ago.

HLA said the prospects and domestic market conditions for Yuchai are expected to remain challenging, but the unit remains committed to its research and development programmes to meet stricter emission standards.

In Singapore, its building materials unit saw improved sales volumes and pricing in recent tenders. HLA said, "The construction of the group's precast manufacturing facility, when ready, will enable the precast business division to continue to be a significant player in Singapore.”

Please click here for HLA’s full results statement.

First Sponsor Group

First Sponsor Group reported 24.7% rise in net profit to S$15.1 million for the second quarter, from S$12.1 million a year ago. This comes on the back of increased revenue from the sale of properties and hotel operations. Earnings per share (EPS) stood at 1.86 Singapore cents, up 12 per cent from 1.66 cents a year ago.

An interim cash dividend of 1.1 Singapore cents per share was declared for the period, up from one Singapore cent a year ago. This will be payable on Sept 13.

Revenue for Q2 rose 80.1% to S$79.4 million, from S$44.1 million a year ago. Revenue from the sale of properties more than quintupled to S$42.2 million, from S$8.0 million the year before. This was mainly due to the recognition of revenue from more commercial units in the Millennium Waterfront project at 100 units, compared with a single unit a year ago.

First Sponsor also saw a 34.4% rise in hotel operations revenue to S$160 million, from S$11.9 million the year prior. This was due to a full quarter contribution from the 94.9% owned Westin Bellevue Dresden Hotel which was acquired in late March this year.

First Sponsor Chief Executive Officer Mr Neo Teck Pheng said that the group would continue to grow its property financing business in China and Australia in a "prudent manner". With the completion of its second rights issue in May, the group has further strengthened its balance sheet and is ready to capitalise on good business opportunities in the Netherlands, Germany, China and Australia for further growth and expansion.

Please click here for First Sponsor’s full financial statement.