Wing Tai reports seven-fold rise in net profit to S$160.8m

The hot housing market has boosted the annual earnings of property developer Wing Tai Holdings.

Its net profit for the financial year ended June, soared seven-fold to S$160.8 million from S$21.0 million in the previous year.

Its fourth quarter net profit came in at S$68.9 million compared to a loss of S$53.8 million a year ago.

Wing Tai’s property sales were the main drivers of its increased annual revenue.

It achieved a 64 percent increase in its revenue to S$821.9 million.

Its revenue a year ago was S$501.8 million.

Wing Tai’s revenue for the fourth quarter, ended June, rose 17 percent to S$222.3 million from S$190.1 million in the same period a year ago.

The property developer said the revenue increase was due to the sales of Belle Vue Residences and the progressive sale from The Riverine by the Park.

At its results briefing, Wing Tai also said it expects a price correction of the upgraders market in the next six to 12 months.

It added that the government will likely continue to release more land supply.

But Wing Tai noted that this is not sustainable as it’ll eventually result in an oversupply in the market.

It has seen a spillover price effect of the upgraders market to the mid-tier properties but warned that the upgraders market will likely come to a saturation point soon.

So Wing Tai said it will continue to keep its focus on the mid- to high-end market for the long term.

Tan Hwee Bin, Executive Director, Wing Tai Holdings, said: “We’re looking at the possibility of launching Belle Vue and Helios and possibly some projects at Admore area as well.

Prices have already spilled over the mid-tier and now it’s moving on to the high end.

We feel that this is probably the opportune time to launch some of these projects.

If you look at our portfolio at this point in time, we have about 900,000 sellable area, GFA and about half are in the high-end market and about half are in the mid-tier market and that has consistently been our focus.”

Singapore contributes about 70 percent of Wing Tai’s assets while the rest are in Hong Kong, Malaysia and China.

Mr Tan said: “Going forward, taking a medium to long term view, we think that Singapore will be about 60 percent of our portfolio and the other countries will count for about 40 percent of our portfolio.”

The Group is also keeping its eye on its two bids put in for the stretch of commercial sites along Stamford Road, which includes the Capitol Theatre.

The site has attracted a total of 14 bids.

Wing Tai said it’s expected to make its concept and design presentation for the area at the end of next month.

Wing Tai is recommending a three cents per share for the first and final dividend.

It is also recommending a special dividend of two cents per share for this year.

Source : Channel NewsAsia – 23 Aug 2010

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