CapitaLand First-Quarter Profit Rises 31% on Asset Sale, Malls

CapitaLand Ltd. (CAPL), Southeast Asia’s biggest developer, said first-quarter profit rose 31 percent as gains from the sale of a hotel and higher shopping mall income offset declines in residential earnings from Singapore and China.

Net income increased to S$133.2 million ($108 million), or 3.1 cents a share, in the quarter ended March 31, from S$101.5 million, or 2.4 cents, a year earlier, it said today in a statement to the Singapore stock exchange. That’s lower than the S$149.4 million average of analyst estimates compiled by Bloomberg. Sales climbed 4.8 percent to S$641.1 million.

Earnings were boosted by a S$28.8 million gain from the sale of the Hilton Doubletree in Kunshan, China, as well as a higher valuation of its investment properties in China and Japan, it said in the statement. Profits declined at residential projects in Singapore and China, it said, two markets where governments imposed measures to curb speculative home-buying.

“Singapore and China will remain key focus markets for new investments,” Liew Mun Leong, president and chief executive officer at Singapore-based CapitaLand, said in the statement. “While the markets in both Singapore and China are adjusting to the official cooling measures, the group expects the longer-term demand to remain healthy.”

Pretax profit from Singapore declined 2.1 percent to S$128.8 million, while China earnings before interest and taxes dropped 38 percent to S$57.8 million, it said. The two are the developer’s biggest markets. Singapore, China and Australia contributed to 88.4 percent of revenues in the quarter compared with 89.7 percent a year earlier, it said.

More Apartments

CapitaLand sold 844 units in Singapore in 2011, an increase from a year ago. It sold 1,500 residential units valued at 3.1 billion yuan in China.

The developer has about 2,500 units under development and expects to sell as many as 1,000 units a year over the next two to three years, it said in its annual report. The developer’s three core markets of Singapore, China and Australia accounted for 79 percent of the group’s pretax profit.

CapitaLand will release more Singapore apartments units for sale at the Interlace and d’Leedon this year, and started selling the Moshe Safdie-designed Sky Habitat, a 509-unit project in Bishan, a suburb in the central part of the island.

In China, the developer said it’s releasing more units at its Royal Residences in Beijing for sale, along with homes in its existing developments. Ascott, the company’s serviced apartment chain, will seek new investments in key Asian and European cities to expand, the developer said.

CapitaLand increased its investments last year, committing a total of S$11 billion for new investments, an 83 percent increase from the S$6 billion worth of investments made in 2010.

The company’s shares were unchanged S$2.94 at the close of trading in Singapore. The stock has gained 33 percent this year, compared with the 13 percent advance in Singapore’s benchmark Straits Times Index.

To contact the reporter on this story: Pooja Thakur in Singapore at pthakur@bloomberg.net

To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net

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