Despite a challenging operating environment, the CDL Group continued to achieve resilient performance in FY 2017, with attributable profit after tax and non-controlling interests (PATMI) of $538.2 million. The Group will focus on driving growth in our property development and recurring income segments, enhancement of asset portfolio performance and enterprise transformation. We will continue to remain disciplined in capital management and be highly selective and strategic in deploying our robust balance sheet.
Market Review and Performance
The CDL Group achieved a PATMI of $538.2 million for FY 2017 (FY 2016: $653.2 million). Basic earnings per share was 57.8 cents (FY 2016: 70.4 cents). In FY 2016, the Group’s performance was boosted by a variety of factors, including a sizable contribution from Hong Leong City Center (HLCC) in Suzhou, higher profit margin residential projects in Singapore, divestment of 52.52% interest in City e-Solutions Limited, sale of Exchange Tower and the Group’s third Profit Participation Securities (PPS). Pre-tax profit was largely distorted by one-off items. The property development segment continued to be the highest contributor, making up 57% for FY 2017. This segment benefited from the partial divestment of the Group’s interest in two China projects in Chongqing to China Vanke Co., Ltd (Vanke) for $55.5 million. Comparatively, in 2016, the Group had a substantial gain following the sale of Exchange Tower in Bangkok. The rental properties segment performed better than the hotel operations segment.
Notably, in 2017, the rental properties segment included a gain following the sale of an office building in Osaka while the hotel operations segment included a write back of impairment losses on loans to a joint venture (JV) of $22 million.
Revenue remained relatively stable at $3.8 billion (FY 2016: $3.9 billion), driven by the strong take-up for our property development projects in Singapore and overseas, such as Gramercy Park, The Venue Residences, Coco Palms and HLCC. Revenue was boosted from revenue recognition in entirety from The Brownstone Executive Condominium (EC). In addition to the contributions from the Group’s investment properties, revenue growth from the hotel operations segment was also enhanced, primarily by the full-year contributions from certain hotels within the Group’s listed subsidiary, Millennium & Copthorne Hotels plc (M&C), notably Millennium Hilton New York One UN Plaza and Grand Millennium Auckland.
Domestically, despite the absence of a new residential launch in FY 2017, the Group, together with our JV associates sold 1,171 units including ECs, with a total sales value of $1.93 billion, again emerging as one of the top-selling private sector developers in Singapore. (FY 2016: 1,017 units with total sales value of $1.25 billion).
The Group’s office portfolio, a key component in our recurring income stream, also continued to enjoy a healthy occupancy rate of 94.8% as at 31 December 2017, compared to the islandwide occupancy rate of 87.4%.
In view of the creditable business results in 2017, the total dividend for the year amounts to 18 cents per share, a 12.5% increase from 2016.
Key Financial Information
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|Revenue||$3,213 m||$3,764 m||$3,304 m||$3,905 m||$3,829 m|
|Tax paid||$135 m||$115 m||$128 m||$157 m||$162 m|
|Staff costs||$705 m||$763 m||$818 m||$810 m||$831 m|
|Profit before tax||$948 m||$1,004 m||$985 m||$914 m||$780 m|
|PATMI||$686 m||$770 m||$773 m||$653 m||$538 m|
|Return on equity||8.9%||9.2%||8.6%||7.0%||5.6%|
|Net asset value per share||$8.50||$9.25||$9.89||$10.22||$10.54|
|Basic earnings per share||74.0 cents||83.2 cents||83.6 cents||70.4 cents||57.8 cents|
|Ordinary dividend per share|
|– Final||8.0 cents||8.0 cents||8.0 cents||8.0 cents||8.0 cents2|
|– Special interim||8.0 cents||4.0 cents||4.0 cents||4.0 cents||4.0 cents|
|– Special final||–||4.0 cents||4.0 cents||4.0 cents||6.0 cents2|
|Preference dividend per share||3.9 cents||3.9 cents||3.9 cents||3.9 cents||3.9 cents|
|1||The 2013 comparative figures were restated to take into account the retrospective adjustments arising from the adoption of FRS 110 – Consolidated Financial Statements.|
|2||Final and special final tax-exempt (one-tier) ordinary dividends proposed for financial year ended 31 December 2017 will be subject to the approval of the ordinary shareholders at the forthcoming Annual General Meeting.|