CDL reports 32% drop in Q3 profits

City Developments Ltd (CDL) reported a 32.4 per cent decline in its third quarter net profit to S$132.1 million on Thursday.

This is lower than the restated net profit of S$195.4 million it posted a year ago, according to the property developer’s stock exchange filing.

CDL said lower contribution from rental properties dragged profits after its disposal of non-core investment properties in 2010 and early 2011.

It also suffered net unrealised losses from fair value readjustments of the group’s trading securities due to the ongoing turmoil in financial markets.

But revenue for the quarter rose 8.1 per cent to S$805.8 million – up from S$745.3 million last year.

For the first nine months, CDL posted a 17 per cent increase in its net profit to S$635.3 million – higher than the S$543 million it reported in the previous year.

This was on higher contributions from its hotel operations and rental properties segments which got a boost from the disposal of its corporate buildings and sale and leaseback of Studio M to CDL Hospitality Trusts (CDLHT).

CDL also said it expects a slowdown in the residential property market. Cautious sentiment will see sales volumes to not be “as swift as before and prices are likely to hover around current levels in the foreseeable future,” its unaudited financial statement said.

The group is previewing its latest property — The Palette — a 892-unit joint venture residential development near Pasir Ris MRT.

Prices for the apartments average $870 per square foot for those who book early. Units in the 99-year lease property are from $561,000 for a 1-bedroom to $1.8 million for a penthouse.

Source : Channel NewsAsia – 10 Nov 2011