City Developments Limited

City Developments Limited (CDL) registered record earnings with net profit after tax and non-controlling interest (PATMI) of S$1.1 billion, reversing a net loss of S$32.1 million for 1H 2021. This is the highest PATMI achieved since the Group’s inception in 1963.

The stellar performance was largely due to divestment gains from the sale of Millennium Hilton Seoul and its adjoining land site for KRW 1.1 trillion (approximately S$1.25 billion), completed in February 2022, as well as the gain on deconsolidation of CDLHT from the Group resulting from the distribution in specie of CDLHT Units in May 2022.

The Group’s revenue for 1H 2022 increased by 23.5% to S$1.5 billion (1H 2021: S$1.2 billion). While the property development segment continued to be the lead contributor, accounting for 41% of total revenue, the increase in revenue for 1H 2022 was primarily attributed to the hotel operations segment. With the recovery of the hospitality sector, driven by border re-openings and the relaxation of travel restrictions, the Group’s hotel RevPAR grew 110.4%, of which the Europe and US regions experienced a strong improvement in both occupancies and average room rates.

Mr Kwek Leng Beng, CDL Executive Chairman, said, “Notwithstanding the macroeconomic volatility, the Group remains cautiously optimistic that the economy will recover with strength. The Group’s record profit performance in 1H 2022 has provided substantial cash flow generation from timely asset divestments. Our hotel operations segment has also rebounded strongly. With post-pandemic travel fuelling continued recovery, we expect hospitality to be a star performer for the rest of the year. As COVID-19 concerns wane, our hospitality portfolio will be a valuable growth engine contributing meaningfully to the Group’s recurring earnings.”

In appreciation of shareholders’ confidence and support, the Board has declared a tax-exempt (one-tier) special interim dividend of 12.0 cents per ordinary share.

Please click here for more information on CDL’s investments in the living sector.

Please click here for CDL’s full 1H 2022 results.

Hong Leong Asia

Hong Leong Asia (HLA) reported attributable net profit to the owners of the Company increase of 4.5% year on year to S$42.6 million for the first half ending June 30, 2022, up from S$40.7 million a year ago.

Group revenue declined 26.1% to S$2.1 billion from S$2.8 billion previously, as the group's key business segment, diesel engines unit in China (Yuchai), recorded lower sales volume and revenue for 1H 2022.

Revenue of Yuchai declined 30.9% to S$1.8 billion with 180,911 engine units sold, a decline of 36.6%. A steeper decline of 56.8% was recorded in engines for on-road commercial applications versus 12.7% decline in engines for off-road applications. This was due to renewed COVID-19 related lockdowns in cities across China which impacted commercial vehicles demand. Reportable segment profit after tax was S$29.9 million, compared with S$74.4 million for 1H 2021 due to lower sales volumes.

Revenue for building materials unit (BMU) increased 26.5% to S$282.0 million with reportable segment profit after tax of S$28.7 million, compared with S$10.7 million previously as construction activities in Singapore and Malaysia improve, driving demand for concrete and related products.

BMU Singapore performed satisfactorily, led by the recovery of ready-mix concrete business and supply for precast products. While the operating environment for BMU Malaysia has improved, the construction-related segment remains challenging given higher input costs, labour shortage, and tighter credit conditions.

Please click here for HLA’s outlook on the construction sector. 

Please click here for HLA’s full 1H 2022 results.