SINGAPORE – City Developments Limited (CDL), the real estate group of Singapore property tycoon Kwek Leng Beng, reported a net loss of $32.1 million for the first half of the year, dragged down by higher tax expenses for the period.
The company had reported a profit of $3.1 million for the first half of last year, after recognising a Covid-19 tax credit from the New Zealand government.
Despite the net loss, the board will pay a special interim dividend of 3 cents per share.
Group revenue for the six months ended June 30 rose 11.1 per cent to $1.2 billion, compared with $1.1 billion in the same period last year, boosted by the property development business, which saw turnover increase by 35.5 per cent.
CDL’s hotel and property investment revenue streams have remained muted with travel restrictions still largely in place for most countries.
But the company said all its business segments are in positive territory except for the hotel operations segment, which reported an operational loss for the period.
The investment properties business also generated lower rental income due to lower footfall at its malls. Since March, its Jungceylon mall in Phuket, Thailand, has been temporarily closed due to the lack of international tourists.
In Singapore, the company sold 971 residential units with total sales amounting to $1.7 billion in the first half, compared with 356 units in the first half of last year for $514.7 million.
The strong sales were largely attributed to the launch of Irwell Hill Residences in April, with 347 out of 540 units sold to date. Other projects that are selling well include Amber Park and Sengkang Grand Residences.
CDL currently has a launch pipeline of close to 2,000 residential units from four upcoming launches. In the fourth quarter of this year, it will launch the Canninghill Piers together with CapitaLand.
The results come after CDL’s record loss of $1.9 billion last year, largely due to impairments from backing Chinese developer Chongqing Sincere Yuanchuang Industrial, which received a bankruptcy application brought against it by a China-based creditor.
The company expects hotel occupancies and revenue to improve as border restrictions are eased and vaccination rates climb.
“We are optimistic of a stronger rebound by the end of 2021 and in early 2022, and expect strong latent demand for travel domestically and regionally, with further upside once international travel is allowed,” Mr Kwek said in a statement.
At 9.37am, CDL traded at $6.67, up six cents, or 0.9 per cent.