| In 2006, the Group achieved
significant milestones in its consistent
corporate strategy of:
(i) remaining focused on the real
estate value chain;
(ii) achieving balance by
diversifying overseas into
new markets, across multiple
sectors and generating a
variety of income streams;
and
(iii) building greater scale to
increase its competitive
advantage.
During the year, the Group
expanded its overseas footprint in
China (including Macau), Vietnam,
Japan and India by way of direct
acquisitions and new partnerships.
It also explored potential new markets
in Russia and the Gulf Co-operation
Council states.
The significant expansion initiatives
in 2006 for future growth were made
without affecting profitability as
evidenced by the record full-year
2006’s PATMI of S$1.018 billion. This
is the Group’s third consecutive year
of record profit. The strong results
were underpinned by significant EBIT
growth in every one of the Group’s
strategic business units (SBU).
The record 2006 performance
was especially significant in that it
was achieved despite the absence
of gains arising from the strategic
divestments of the Group’s hotel
business and property services, which
boosted the full year results in 2005 by
S$424.8 million. Excluding these gains
in 2005, the year-on-year growth was
even more impressive.
Revenue
Revenue for full year 2006 at
S$3,147.7 million was 18.1% lower
than the previous year. This decrease
arose because revenue in 2005 was
boosted by our business in Australia,
which recognised one-off sales of
certain properties to Australand
Wholesale Property Trust No. 4.
Overall, this relative decrease was
partially cushioned by a higher
contribution from the serviced
residences operations, higher fund
management fees and, in China,
better residential sales and revenue
from the retail malls in 2006.
Our residential business continues
to be a key component of our
business strategy. Approximately
74.2% of the Group’s revenue in 2006
was contributed by the Residential
(CRL) SBU. During the year, we
expanded our hospitality business
through The Ascott Group Limited
(Ascott) and Ascott Residence Trust
(ART). Revenue from the Serviced Residences SBU contributed
15.1% of the total, up from 11.5%
in 2005. Commercial and Integrated
Development (CCID) SBU contributed
4.4% while Retail (CRTL) SBU
registered a higher contribution of
3.0%, compared to 1.3% in the
previous year. CapitaLand Financial’s
(CFL) SBU contribution to total
revenue has also grown, accounting
for 3.2% to the Group’s revenue, a
marked increase from the 1.8% in the
previous year. This growth is a result
of our committed strategy to increase
our fee-based income by increasing
the assets under management.
In terms of geographic spread,
revenue from overseas operations
remained strong, accounting for
71.2% of the Group’s total revenue.
The major overseas contributors to
the Group’s revenue were Australia
and New Zealand (39.6%), China
(20.2%) and Europe (8.0%). Revenue
from Australia was derived from our
listed subsidiary, Australand, as well
as from Ascott’s Oakford chain of
service apartments. Contributions
from China came mainly from the
robust residential sales in Shanghai
as well as the consolidation of
revenue from Raffles City in Shanghai.
Revenue in Europe was mainly
contributed by the Citadines chain
of serviced residences
under Ascott. |
