CapitaLand’s 3Q 2018 PATMI increases 13.6% to S$362.2 million
Singapore, 14 November 2018 – CapitaLand Limited achieved a PATMI of S$362.2 million in 3Q 2018, 13.6% higher as compared to 3Q 2017, on account of higher operating PATMI and gains from asset recycling. Operating PATMI improved by 13.3% to S$233.7 million mainly attributed to contributions from newly acquired and opened investment properties in Singapore, China and Germany.
Revenue for 3Q 2018 was S$1,260.0 million, lower than 3Q 2017 mainly due to lower contributions from development projects in Singapore and China. The decrease in revenue was partially mitigated by higher rental revenue from newly acquired and opened properties in Singapore, China and Germany, as well as the consolidation of revenue from CapitaLand Mall Trust (CMT), CapitaLand Retail China Trust (CRCT) and Raffles City Singapore Trust (RCST)1 with effect from August 2017. The development projects which contributed to the revenue this quarter were The Metropolis in Kunshan, CapitaMall Westgate integrated development in Wuhan, as well as The Interlace and Sky Habitat in Singapore.
The Group achieved an EBIT of S$796.3 million in 3Q 2018, attributed to recurring income from investment properties and contribution from development projects, fair value uplift arising from Westgate in Singapore, and portfolio gains from the completion of divestment of 18 malls2 in China. Singapore and China markets remain the key contributors to EBIT, accounting for 84.2% of total EBIT, up from 83.5% in 3Q 2017.
Financial highlights
|
3Q 2018 |
3Q 2017 (Restated)3
|
Variance |
YTD Sep 2018 |
YTD Sep 2017 (Restated)3 |
Variance |
Variance (Excluding gain from sale of The Nassim) |
Revenue |
1,260.0 |
1,515.7 |
(16.9) |
3,978.0 |
3,405.6 |
16.8 |
16.8 |
Earnings before interest and tax (EBIT) |
796.3 |
794.7 |
0.2 |
2,867.9 |
2,409.5 |
19.0 |
27.5 |
Total PATMI |
362.2 |
318.8 |
13.6 |
1,286.8 |
1,291.7 |
(0.4) |
13.8 |
Operating PATMI4 |
233.7 |
206.3 |
13.3 |
658.4 |
757.6 |
(13.1) |
10.3 |
Mr Lee Chee Koon, President & Group CEO of CapitaLand Group, said: “CapitaLand’s disciplined capital recycling continues to gain momentum. We have divested S$4 billion worth of assets and deployed the capital into S$6.1 billion worth of new investments to date this year. These include acquisitions to secure a good development pipeline as well as higher yielding assets that are immediately income producing.”
Mr Lee added: “We are actively building a resilient and diversified portfolio across asset classes and key geographies where we already have dominant footholds. With our primary pieces in place, we have expanded into complementary asset segments including the deep and scalable U.S. multifamily asset class. Our moves are in line with our strategy of maintaining a balance between emerging and developed markets, while targeting an optimal mix between trading and investment properties.”
In 3Q 2018, CapitaLand acquired a mixed-use site at Sengkang Central in Singapore, a site to build the first coliving property in one-north, two prime residential sites in Guangzhou, China which will yield 1,300 units and a prime site in District 2 of Ho Chi Minh City, Vietnam which will yield 100 landed residential units.
CapitaLand received strong take-up from its new launches in 3Q 2018 for La Botanica, Xi’an, La River, Guangzhou and Park Botanica, Chengdu, China. More than 95% of launched units were sold for the nine months ended 30 September 2018. In terms of handovers, CapitaLand handed over 1,279 units in 3Q 2018, mainly from Citta Di Mare in Guangzhou, The Metropolis in Kunshan, as well as the strata apartments of CapitaMall Westgate in Wuhan and Skyview in Raffles City Hangzhou. As at 30 September 2018, the Group has 7,000 units valued at RMB15.9 billion that have been sold in China. About 40% of this value is expected to be recognised in 4Q 2018.
In Singapore, the Group sold 14 residential units worth S$52 million in 3Q 2018. In Vietnam, CapitaLand sold 171 residential units with a sales value of S$53 million in 3Q 2018, mainly from De La Sol, Seasons Avenue and Vista Verde. In the quarter, the Group handed over 482 units valued at S$96 million, mainly from Seasons Avenue and Vista Verde. This is 70% higher than 3Q 2017 in terms of sales value. As at 30 September 2018, the Group has 2,369 units valued at approximately S$712 million that have been sold in Vietnam. More than 10% of this value is expected to be recognised in 4Q 2018.
[1] The Group consolidated CMT, CRCT and RCST into the Group’s results with effect from August 2017. The consolidation of three trusts increased the Group’s revenue and EBIT by S$86.9 million and S$32.2 million respectively for 3Q 2018 and S$611.1 million and S$446.9 million respectively for YTD September 2018. However, PATMI for 3Q 2018 and YTD September 2018 were lower by S$12.0 million due to absence of the re-measurement gain arising from consolidation of the three trusts in 3Q 2017.
[2] CapitaLand announced in January 2018 the divestment of its share of interest in a group of companies that hold 20 retail assets in China. Following the completion of the divestment of 18 malls in 3Q 2018, divestment of the two remaining malls was completed on 9 October 2018.
[3] 3Q 2017 and YTD September 2017 results have been restated to take into account the retrospective adjustments relating to SFRS(I) 15 Revenue from contracts with customers.
[4] Operating PATMI refers to profit from business operations excluding any gains or losses from divestments, revaluations and impairments. Operating PATMI for YTD September 2017 included a gain of S$160.9 million from the sale of 45 units of The Nassim.