Financials
Condensed Interim Financial Statements For The Six Months and Full Year Ended 31 December 2023
Financials Archive
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Condensed Interim Consolidated Statement Of Comprehensive Income
Notes:
- Included in Profit before tax is profit on sale of development properties of approximately $6,217,000 and $8,341,000 (2022: $27,784,000 and $35,030,000) respectively for the six months and full year ended 31 December 2023.
- NM – Not Meaningful.
Condensed Interim Statements Of Financial Position
Review of Performance
The Group posted a revenue of approximately $110.6 million for 2023 as compared to approximately $153.9 million for 2022. The decrease in revenue of approximately $43.3 million was mainly due to decrease in sales of the residential units in Concourse Skyline but this was marginally cushioned by increases in rental income of its properties mainly from the hotel, YOTEL Singapore Orchard Road (“YOTEL”) and property management income.
The Group’s other income decreased mainly due to lesser grants received from the Singapore Government and no wage subsidy given by the Hong Kong Government in 2023.
The decrease in depreciation expense arose mainly from the disposal of furniture in the sales of the residential units in Concourse Skyline.
The Group recorded a gain of approximately $87.1 million in 2023 as compared to approximately $197.3 million in 2022 on the revaluation of its investment properties based on independent external valuations as at 31 December 2023.
The changes in fair value of other investments at fair value through profit or loss was mainly due to higher fair value gain in the valuation of its quoted equity investments and debt investments as at 31 December 2023.
With the recognition of lower sales revenue from its development properties, there was also a decrease in cost of sales of development properties.
The increase in maintenance expenses for 2023 as compared to 2022 was mainly due to the increase in property management costs, higher maintenance fees charged by managing agent, higher costs charged by maintenance service providers, the surge in electricity prices and improvement works for its properties.
The decrease in professional fees was mainly due to the once-off legal and professional costs incurred in the previous corresponding year for the acquisition of non-controlling interests.
The increase in property tax was mainly due to the properties being assessed with higher annual values in 2023.
The increase in rental commission for 2023 as compared to 2022 was due to more leases of its properties being introduced by real estate agents.
The increase in net exchange loss for 2023 as compared to 2022 was mainly due to the more pronounced strengthening of the Singapore dollar for its investments in securities and cash and cash equivalents denominated in Hong Kong dollar and United States dollar.
The increase in finance income was mainly due to interest income from more Hong Kong dollar deposits placed with financial institutions in Hong Kong at higher interest rates and the increase in the deferred day one gain on Hong Kong dollar unsecured bonds.
The increase in finance expense was mainly due to higher interest rates on its secured loans.
The decrease in tax expense was mainly due to less taxable profit contributions from companies in a tax-paying status.
Overall, the Group posted a profit of approximately $95.0 million in 2023 as compared to approximately $233.9 million in 2022.
Consequently, the Group’s profit attributable to Owners of the Company was approximately $88.1 million in 2023 as compared to approximately $220.1 million in 2022.
The net decrease in property, plant and equipment was mainly due to its depreciation.
The decrease in right-of-use assets was mainly due to the depreciation.
The increase in other assets was mainly due to write back of impairment loss in 2023 for club memberships.
The net decrease in other investments was mainly due to disposal of marketable securities in 2023, cushioned by fair value gain on valuation of its other investments as at 31 December 2023.
The net decrease in development properties was mainly due to the sales of the residential units in Concourse Skyline.
The increase in cash and cash equivalents was mainly to enhance the Group’s liquidity.
The decrease in lease liabilities was mainly due to monthly payments of lease commitments.
The decrease in current tax liabilities was mainly due to the net effect in provision of tax for 2023 and the instalment payments of tax for 2022.
Commentary On Current Year Prospects
The Group is optimistic on the room rates and occupancy rate of its hotel, YOTEL with the expected continued recovery in air travel and tourism demand.
The leasing demand for office and retail units is generally healthy and hence the occupancy rates of the Group’s other investment properties are expected to remain stable.
The higher Additional Buyer’s Stamp Duty rates on residential properties in Singapore that was introduced last year will continue to deter foreign buyers and investors. The current residential market is likely to continue to remain moderately weak with buying momentum driven by mainly local buyers. The Group is expected to continue to recognise revenue from the sales of its residential units in Concourse Skyline.
The possibility of interest rate cuts expected during 2024 may improve the performance of the Group’s properties but this may be dampened by higher operating costs such as energy costs, property taxes, commission expenses, maintenance expenses, etc.