CapitaLand FY 2017 PATMI increases 30.3% to S$1.55 billion
Proposes ordinary dividend of 12 Singapore cents per share
Singapore, 13 February 2018 – CapitaLand Limited achieved a total PATMI of S$1,550.7 million in FY 2017, 30.3% higher than PATMI for FY 2016 of S$1,190.3 million. Operating PATMI for FY 2017 increased S$43.0 million or 5.0% to a record high of S$908.3 million, on account of higher contribution from development projects in Singapore and newly acquired and opened shopping malls and serviced residences. The increase in total PATMI was also due to higher portfolio and fair value gains from divestments of Innov Tower in China, One George Street and Wilkie Edge in Singapore, as well as serviced residence properties in Germany, China and Japan.
For 4Q 2017, the Group registered PATMI of S$267.7 million and operating PATMI of S$159.4 million. The lower PATMI and operating PATMI compared to the corresponding quarter were mainly due to lower handover of units for development projects in China.
Revenue for FY 2017 decreased 12.2% to S$4,609.8 million mainly due to lower completion and handover of units from development projects in China, partially mitigated by rental contribution from newly acquired and opened properties, as well as the consolidation of revenue from CapitaLand Mall Trust (CMT), CapitaLand Retail China Trust (CRCT) and RCS Trust (RCST)[1].
The major handover in FY 2017 for development projects in China include Summit Era in Ningbo, One iPark in Shenzhen, Century Park West in Chengdu, The Beaufort in Beijing and International Trade Centre in Tianjin.
The Group achieved an EBIT of S$3,110.5 million for FY 2017, 31.8% higher than the S$2,359.5 million for FY 2016. Singapore and China markets remain the key contributors to EBIT, accounting for 87.8% of total EBIT, up from 83.5% in FY 2016.
Financial highlights
FY 2017 (S$ m) |
FY 2016 (S$ m) |
Variance (%) |
4Q 2017 (S$ m) |
4Q 2016 (S$ m) |
Variance (%) |
|
Revenue |
4,609.8 |
5,252.3 |
(12.2) |
1,212.6 |
1,852.8 |
(34.6) |
Earnings before interest and tax (EBIT) |
3,110.5 |
2,359.5 |
31.8 |
710.6 |
815.8 |
(12.9) |
Total PATMI |
1,550.7 |
1,190.3 |
30.3 |
267.7 |
430.5 |
(37.8) |
Operating PATMI[2] |
908.3 |
865.3 |
5.0 |
159.4 |
289.1 |
(44.9) |
Mr Ng Kee Choe, Chairman of CapitaLand Limited, said: “Amidst market headwinds, our sustained growth momentum attests to the quality of CapitaLand’s earnings and our commitment to create and deliver long-term sustainable value to shareholders. In line with CapitaLand’s policy to grow dividends on a sustainable basis, the Board is proposing a final ordinary dividend of 12 Singapore cents a share for FY 2017. This is 2 cents higher than the FY 2016 dividend of 10 Singapore cents a share.”
Mr Lim Ming Yan, President & Group CEO of CapitaLand Group, said: “CapitaLand achieved total PATMI of S$1.55 billion for FY 2017, the highest PATMI recorded since FY 2008. CapitaLand’s resilient financial performance has enabled the Group to deliver a return on equity of 8.5% for FY 2017, compared to 6.6% in FY 2016. Largely attributable to the success of our active portfolio reconstitution strategy, we unlocked S$2.6 billion through divestments and announced S$5.7 billion of new investments in FY 2017.”
The Group has enhanced the quality of its portfolio of assets extensively in FY 2017, with the acquisition of numerous prime assets, including Asia Square Tower 2 in Singapore; Rock Square in Guangzhou; a commercial building, Innov Center, with an adjacent site in Wujiaochang decentralised business district in Shanghai; and the Main Airport Center commercial building in Frankfurt, Germany.
CapitaLand sold 1,409 residential units in Vietnam to achieve record sales of S$459.6 million, 63% higher than the S$282.1 million achieved in FY 2016. The sales were mainly from Seasons Avenue, Feliz en Vista, Mulberry Lane and d’Edge. The Group also recorded higher sales value in Singapore at S$1,479 million from 407 residential units sold in FY 2017 compared to S$1,415 million in FY 2016. For FY 2017, 8,497 units were sold in China at a value of approximately S$3.1 billion (2016: 10,738 units; S$3.7 billion). The lower sales was primarily due to fewer units available for sale, with over 10,000 available units in FY 2017, as compared to over 12,000 available units last year. The sales were mainly from La Botanica in Xi’an, The Metropolis in Kunshan, Citta Di Mare in Guangzhou, Raffles City Residences in Chongqing, Vermont Hills in Beijing, New Horizon in Shanghai, Summit Era in Ningbo, and Sky Habitat, the SOHO units of Raffles City Hangzhou.
In FY 2017, CapitaLand expanded its network of malls in key city clusters through two acquisitions in China and Japan, six new mall openings in China and Malaysia, and five management contracts secured in China and Singapore. A record of 1.2 million square metres of retail gross floor area expanded across the four countries during the year. This expansion increased the Group’s recurring income base and affirms its ‘core city clusters, dominant assets’ strategy of maximising return on investments.
FY 2017 was The Ascott Limited’s strongest year with about 24,000 units added to its global portfolio through investments, management contracts and franchise agreements, including new markets such as South America and Africa. During the year, Ascott also opened 18 properties with close to 3,800 units. As Ascott is set to surpass its 80,000-unit target well ahead of 2020, it now aims to double its portfolio to 160,000 units by 2023.
[1] With effect from August 2017, the Group consolidated the financial results of CMT, CRCT and RCST which were previously equity accounted as associates and joint venture. The consolidation of these three trusts increased Group’s FY 2017 revenue, EBIT and PATMI by S$425.8 million, S$278.2 million and S$12.0 million respectively.
[2] Operating PATMI refers to profit from business operations excluding any gains or losses from divestments, revaluations and impairments. Operating PATMI for FY 2017 included a gain of S$160.9 million from the sale of 45 units of The Nassim in 1Q 2017. Operating PATMI for FY 2016 included a fair value gain of S$30.5 million which arose from the change in use of a development project in China, Raffles City Changning Tower 2 in 1Q 2016. The change in use of the development was due to a reclassification of the project from construction for sale to leasing as an investment property.