OUE's Q1 profits up 0.3% to $1m

Higher contribution from US Bank Tower boosted its performance.

Property developer OUE started 2019 on a high note after profits edged up 0.3% YoY to $1m in Q1, an announcement revealed. Revenue also rose 1.3% YoY from $145.6m to $147.3m.

Its earnings were bolstered by higher contributions from the group’s investment properties and development property divisions, its financial statement showed. Revenue from the investment properties division increased 2.8% to $71.5m, mainly contributed by US Bank Tower which benefited from higher occupancy rates.

The development property division contributed revenue of $7.2m due to the completion of certain OUE Twin peaks units sold under deferred payment schemes.

Earnings before interest and tax (EBIT) jumped 13.6% YoY from $54.6m to $62m, due to contributions from First Real Estate Investment Trust and Bowsprit Capital Corporation which were acquired in October 2018, as well as higher contribution from Oakwood Premier OUE Singapore.

On the other hand, revenue from its hospitality division slipped by $2.6m to $56.3m due to lower room revenue and banquet sales from Mandarin Orchard Singapore. Similarly, the firm witnessed a dip in revenue contribution from its healthcare division due to lower revenue recorded by OUE Lippo Healthcare (OUELH) in China.

That said, OUELH completed its maiden venture in Myanmar with the acquisition of three hospitals, a medical centre and two clinics in the firm’s efforts to grow its pan-Asia healthcare network.

“As part of the group’s efforts to further scale up its businesses, OUE expanded into the food & beverage (F&B) and lifestyle business with the acquisition of a 49.7% stake in Superfood Retail, which owns and operates cafes and restaurants in Singapore and Hong Kong. The acquisition is a complementary fit with OUE’s current food & beverage portfolio and will provide the group with an immediate footprint in these markets and access to an experienced F&B team,” OUE highlighted.

Also read: OUE sells entire equity stake in Nuvest Capital for $1m

In April 2019, OUE also divested its minority stakes in Marina Mandarin Singapore and the Marina Square retail and commercial complex for an aggregate consideration of $390m.