CapitaLand achieves FY 2019 PATMI of S$2.14 billion, year-on-year increase of 21.2%
Ho Chi Minh City, 27 February 2020 – CapitaLand Limited achieved a total PATMI of S$2,135.9 million in FY 2019, 21.2% higher than the S$1,762.5 million for FY 2018. Operating PATMI [1] was S$1,057.2 million, a record high for the Group. This was driven by contributions from Ascendas-Singbridge (ASB) businesses [2] , assets acquired in FY 2018 and assets that turned operational in FY 2019. Full-year ROE rose to 10.0% from 9.3% in FY 2018, the Group’s first double-digit ROE in almost 10 years.
For 4Q 2019, PATMI was S$926.6 million, 94.8% higher than 4Q 2018. The increase was mainly due to better operating performance, higher gains from asset recycling and revaluation of investment properties. Operating PATMI [1] grew 95.7% to S$418.3 million in 4Q 2019. This was mainly attributed to contributions from ASB businesses and higher recurring income from investment properties in Singapore and China.
Revenue for 4Q 2019 grew 46.3% to S$2,375.9 million, mainly due to the consolidation of ASB and Raffles City Chongqing as well as higher contributions from Singapore and China malls and lodging properties in the USA. The residential developments contributing to revenue in the quarter were Raffles City Residences in Chongqing, Vermont Hills in Beijing and Parc Botanica in Chengdu, China; as well as Marine Blue in Singapore.
For FY 2019, EBIT was S$5,067.6 million, an increase of 22.3% from the S$4,145.0 million in FY 2018. Singapore and China markets remain the key contributors to EBIT, accounting for 83.7% of total EBIT for the year.
Notwithstanding the Group’s strong financial results, the Board is proposing a final ordinary dividend of 12 Singapore cents per share for FY 2019, unchanged from FY 2018. This prudent approach will enable the Group to remain resilient during this period of uncertainty brought about by the COVID-19 situation.
Financial highlights:
|
FY 2019 (S$ m) |
FY 2018 (S$ m) |
Variance (%) |
4Q 2019 (S$ m) |
4Q 2018 (S$ m) |
Variance (%) |
Revenue |
6,234.8 |
5,602.4 |
11.3 |
2,375.9 |
1,624.5 |
46.3 |
Earnings before interest and tax (EBIT) |
5,067.6 |
4,145.0 |
22.3 |
1,933.3 |
1,132.2 |
70.8 |
Total PATMI |
2,135.9 |
1,762.5 |
21.2 |
926.6 |
475.7 |
94.8 |
Operating PATMI1 |
1,057.2 |
872.2 |
21.2 |
418.3 |
213.8 |
95.7 |
Mr Ng Kee Choe, Chairman of CapitaLand Limited, said: “We achieved improved all round performance in 2019, underpinned by sustained growth momentum and a larger and more diversified platform following the combination with Ascendas-Singbridge. Our PATMI grew to S$2.14 billion and our ROE increased to 10.0%, exceeding our cost of equity for the third consecutive year. Our strong fundamentals position us well to address the challenges brought about by the outbreak of COVID-19 as we steadfastly continue our efforts to grow our business and deliver long term sustainable value. Meantime, we will spare no efforts in safeguarding the well-being of our staff, tenants and patrons during this period.”
Mr Lee Chee Koon, Group CEO of CapitaLand Group, said: “We completed the merger with Ascendas-Singbridge in June last year and this strategic transaction has yielded positive outcomes for CapitaLand. Through a disciplined approach towards capital recycling and management, we have lowered our net debt-to-equity ratio to 0.63x by end 2019, one year ahead of schedule [3]. With a strong balance sheet, CapitaLand is well-positioned to continue to pursue growth and be ready to seek counter-cyclical opportunities.”
“The sudden outbreak of COVID-19 has definitely affected our businesses and those of our partners and tenants, especially in China and Singapore. The extent of the impact will depend on how long the outbreak lasts. Nevertheless, we remain positive on the long-term fundamentals for Singapore and China. Our priority is to ensure the well-being of our staff, tenants and patrons. At the same time, we will proactively manage our business, including giving targeted relief measures to tenants and contributing to efforts to help the community and medical staff dealing with COVID-19. CapitaLand will fight and ride though this difficult period together with our stakeholders.”
As a show of togetherness and solidarity with its stakeholders, Board members and senior management will take a reduction in their board fee and base salary, from 5% to 15% effective from 1 April 2020. The Group has also imposed a wage freeze for all staff at managerial level and above. These measures will be reviewed after six months or when the position arising from the COVID-19 outbreak has stabilised.
To further support CapitaLand’s retail partners, a portion of the compensation for its managerial staff in Singapore will be paid in CapitaVouchers [4] for use in CapitaLand malls. About S$2 million worth of CapitaVouchers [4] will be distributed in total. CapitaLand will continue to monitor the situation and is prepared to render more assistance if and when needed.
Through its philanthropic arm, CapitaLand Hope Foundation, CapitaLand has also pledged about S$2.3 million in donations, as a start, to support healthcare workers and affected communities in Singapore and China.
Changes in Financial Reporting and Asset Valuation Frequency
Starting FY 2020, CapitaLand will be adopting the option for semi-annual reporting and complying with continuous disclosure requirements in Singapore, as announced by Singapore Exchange Regulation (SGX Regco) on 9 January 2020. CapitaLand will also commence conducting its asset valuation on an annual year-end basis. The Group believes these changes will encourage investors to focus more on the sustainability of its earnings, and to take a longer-term view of the business.
[1] Operating PATMI refers to profit from business operations excluding any gains or losses from divestments, revaluations and impairments
[2] The Group completed the acquisition of ASB on 28 June 2019 and ASB businesses contributed to the Group’s 2H 2019 profit or loss
[3] CapitaLand had earlier announced its target of lowering net debt-to-equity ratio to 0.64x by end 2020.
[4] Part of the C apitaVouchers will be distributed in the form of STAR$®, the rewards point for C apitaStar, which can be exchanged for CapitaVouchers and its digital version eCapitaVouchers, in addition to merchant deals
About CapitaLand Limited
CapitaLand Limited (CapitaLand) is one of Asia’s largest diversified real estate groups. Headquartered and listed in Singapore, it owns and manages a global portfolio worth over S$131.9 billion as at 31 December 2019. CapitaLand’s portfolio spans across diversified real estate classes which includes commercial, retail; business park, industrial and logistics; integrated development, urban development; as well as lodging and residential. With a presence across more than 200 cities in over 30 countries, the Group focuses on Singapore and China as its core markets, while it continues to expand in markets such as India, Vietnam, Australia, Europe and the USA.
CapitaLand has one of the largest real estate investment management businesses globally. It manages seven listed real estate investment trusts (REITs) and business trusts as well as over 20 private funds. Since it pioneered REITs in Singapore with the listing of CapitaLand Mall Trust in 2002, CapitaLand’s REITs and business trusts have expanded to include Ascendas Real Estate Investment Trust, CapitaLand Commercial Trust, Ascott Residence Trust, CapitaLand Retail China Trust, Ascendas India Trust and CapitaLand Malaysia Mall Trust.
About CapitaLand Vietnam
CapitaLand Vietnam is a business unit of CapitaLand, one of Asia’s largest diversified real estate groups.
After 25 years of operation in Vietnam, CapitaLand’s portfolio in Vietnam comprises two integrated developments, close to 8,600 quality homes across 15 residential developments, two retail malls, one business park as well as more than 7,000 lodging units in 28 properties across nine cities - Ho Chi Minh City, Hanoi, Hai Phong, Halong, Hoi An, Danang, Binh Duong, Cam Ranh and Nha Trang.
In line with CapitaLand’s credo ‘Building People. Building Communities.’, the Group is committed to contribute to the Vietnamese economy by seeking opportunities to expand its presence in the country.CapitaLand will also continue to hire and nurture a strong local team, exchange knowledge and skills with local partners, and contribute to the local communities’ underprivileged children and environment through corporate social responsibility efforts.CapitaLand has also built four CapitaLand Hope Schools for underprivileged children in Phu Tho, Long An and Hung Yen Province.