CityDev Q1 profits down 16.3% to $80.03m

Its sales, however, jumped 66% to 459 units with a total sales value of $792.6m.

City Development's (CDL) profits in the first quarter of 2018 slipped by 16.3% from $95.62m last year to $80.03m no thanks to lower gross profit and higher finance costs. Revenue, however, jumped 35% from $783.66m to $1.06b.

According to its financial statement, revenue was propelled by the completion of The Criterion Executive Condominium (EC). "Under prevailing accounting standards, revenue and profits are recognised in entirety upon obtaining Temporary Occupation Permit (TOP) for an EC project," it explained.

CDL noted that it benefited from the maiden contribution of New Futura as well as continued contributions from Coco Palms and Suzhou Hong Leong City Center but an absence of contributions from D'Nest and The Venue Residences which obtained TOP last year.

"Notably, whilst New Futura achieved stellar sales performance since its launch in January 2018, the profits will only be booked in when the sale of the units are legally completed," CDL added.

There was also a pre-tax divestment gain of $29m from the sale of Mercure Brisbane and Ibis Brisbane by CDL's indirect subsidiary, CDL Hospitality Trusts (CDLHT) in which the Group’s effective interest is 24%.

The company's property development segment was the major contributor to profits at 48%. Its rental properties segment doubled its profits thanks to gains from CDLHT.

The hotel operations segment which consists primarily of the group’s 65.2% owned subsidiary, Millennium & Copthorne Hotels plc (M&C), reported higher profit largely from newly opened/acquired hotels such as the 190 room M Social Auckland which opened in October 2017 and The Lowry Hotel which was acquired in Q2 2017.

CDL added that the Phase 1 of New Futura has been 97% sold (62 apartments) for an average selling price of $3,350 psf. About 73% of the buyers were foreigners and permanent residents, mainly from Asia. The Tapestry has been sold 80% (400 units) with an ASP of $1,360 psf.

Meanwhile, the 174-unit Gramercy Park along Grange Road has only one unit remaining.

The Group’s JV projects namely the 519-unit Forest Woods condominium located near Serangoon MRT station is now 95% sold, the 944-unit Coco Palms in Pasir Ris has only 10 units remaining and the 505-unit The Criterion EC in Yishun has one unit left. Its other JV EC project, the 638-unit The Brownstone located next to the upcoming Canberra MRT station, is also fully sold.

CDL was able to sell 459 units with a total sales value of $792.6m, 66% higher than last year's value.