CityDev Q2 profits ballooned 79.5% to $204.79m

It achieved stellar sales in Singapore and China.

City Developments (CDL) popped the champagne in the second quarter of 2018 as profits jumped by 79.5% to $204.79m from $114.08m in the same period last year. According to its financial statement, revenue was up by 59.2% to $1.36b.

CDL’s property development segment for Q2 2018 was powered mainly by three projects – New Futura and Gramercy Park in Singapore and Hong Leong City Center (HLCC) in Suzhou, China. The contribution from HLCC relates to Phase 2, completed in May 2018, and profits recognised in entirety for 58% of the units handed over to purchasers in the current quarter.

This segment also included profits from the Group’s joint venture (JV) development Park Court Aoyama The Tower in Tokyo, Japan. The Criterion Executive Condominium (EC), which is now fully sold, achieved its Temporary Occupation Permit (TOP) in Q1 2018 and boosted the revenue for H1 2018.

CDL also cited that The Tapestry had achieved “stellar sales” since its Phase 1 launch in March 2018 even if it is still in its initial stages of construction. “Profits will continue to be recognised progressively,” it said.

For the first half of 2018, profits jumped 35.8% to $284.82m, whilst revenue grew by 47.6% to $2.42b.

For H1, the property development segment contributed 68.1% sustained by healthy profit margins. The Group’s overseas diversification strategy, especially in China and Japan, contributed 40% of the property development segment for H1.

Meanwhile, the hotel operations segment led by Millennium & Copthorne Hotels plc (M&C), continued to face challenges, with lower revenue and profits reported for Q2 2018.

“This was largely attributed to its UK hotels which underperformed partly due to their slow adjustment to competitive market conditions, coupled with the bigger impact from the phased closure of Millennium Hotel London Mayfair (Mayfair hotel), which was undergoing refurbishment and is now fully closed as of the beginning of July 2018,” CDL added.

The company declared payment of a tax-exempt (one-tier) special interim dividend of 6 cents per ordinary share.