CapitaLand's profits severely hit by divestment, impairment losses

Profits crashed 45.6% to $142.9m.

According to OCBC Investment Research, CapitaLand’s 4Q13 PATMI decreased 45.6% YoY to S$142.9m mostly due to divestment losses from its 20% Australand stake, impairments from investments in China, India, Abu Dhabi and Australia and forex losses.

Here's more:

FY13 PATMI cumulates to S$849.8m, which fell 9.5% short of our full year forecast, and we judge these results to be below our expectations and consensus. Excluding one-time items, however, operating PATMI for FY13 stands at S$527.7m, which is a respectable 42.9% increase but still short of expectations.

4Q13 topline is S$1,085.1m, down 2.3% YoY mostly due to the deconsolidation of Australand and lower revenues from domestic development projects. A dividend of 8.0 S-cents per share was proposed, versus 7.0 cents previously.

Unsold domestic residential exposure below 10% of assets

Over FY13, we saw 1,260 residential units sold in Singapore, up significantly versus the 681 units sold in FY12. Note that the group now has fairly limited exposure to the uncertain domestic residential space and its current 1.6k of unsold units forms <10% of total assets.

With three relatively small sites in its landbank and, given management’s constructive view on the domestic residential space over the mid-long term, we expect them to continue replenishing their landbank this year. Management also updates that its Danga Bay project is likely to be launched for sales in FY14.