Frasers Property profits fall 25% to $569m in FY2019 over Australia woes

The company’s Singapore and Australian projects reported lower contributions.

Frasers Property reported moderate earnings for the full-year ending 30 September, with attributable profits slipping 25.3% YoY to $560.3m in FY2019 from $749.7m in the previous year, the company’s SGX filing revealed. Revenue also slipped 12.2% YoY to $3.79b in FY2019 from $4.32b in FY2018.

The declines were largely attributable to lower contributions from development projects in Singapore and Australia. This was partially offset by contributions from the newly acquired PGIM Real Estate AsiaRetail Fund (PGIM ARF) and the consolidation upon the step-up acquisition of Golden Land Property Development Public Company.

Also read: Frasers Property profits up 68.2% to $333.93m in Q3

Profits before fair value change, taxation, and exceptional items (PBIT) dipped 3% YoY to $1.29b for FY2019 from $1.33b for FY2018.

Revenue and PBIT for Frasers’ Singapore Strategic Business Unit plummeted 49% YoY and 4% YoY to $687m and $466m, respectively, on the back of losses at its residential property segment. Local residential properties' PBIT diminished $175m and recorded a $22m loss, whilst revenue for the segment dropped $766m to $122m for FY2019. This was largely due to lack of contributions from fully-sold properties, such as Parc Life Executive Condominium and North Park Residences, as well as provisions for project costs.

On the other hand, revenue and PBIT for the company’s Singapore retail and commercial properties grew 20% YoY and 47% YoY to $565 million and $494 million, respectively. This was driven by maiden contributions from PGIM ARF, as well as higher operating contributions from the south wing of Northpoint City and Frasers Tower, both which recorded higher occupancies. 

Meanwhile, Frasers Property’s Australian portfolio reported falls of 5% YoY and 19% YoY revenue and PBIT to $1.51b and $281m, respectively. This was blamed on The decrease in revenue was mainly due to the lumpiness of sales settlements of residential projects, with fewer sales settlements at Tailor’s Walk in Botany, New South Wales. 

Revenue and PBIT for Frasers Logistics and Industrial Trust (FLT) jumped 16% YoY and 18% YoY to $231m and $168m, respectively, mainly because of full year’s contributions from its portfolio of assets in Europe acquired in May 2018.

A proposed final dividend of $0.036, to be paid on 18 February 2020. This puts the total distribution for the year at $0.06 per share.