Published 13 May 2011
The Business Times
By Uma Shankari
Higher earnings due to better revenue, accounting changes
SC Global Developments’ net profit rose to $72.8 million for the first quarter of this year, 15 times the restated $4.78 million net profit for the 2010 corresponding quarter.
The earnings growth was due to higher revenue, higher gross margins and the effects of accounting changes.
The group saw higher revenue recognition for its Singapore development projects as construction progressed.
SC Global has adopted the Financial Reporting Standard INT FRS 115. Accordingly, the Q1 2010 results were restated to be comparable to those of Q1 2011. The net profit for Q1 2010 was restated at $4.8 million, instead of the $13.4 million reported last year.
Group revenue for the three months ended March 31, 2011, rose 29 per cent to $221.2 million, from a restated $171.9 million in the same three months of 2010.
Turnover for Q1 2011 included contributions from progressive revenue recognition of SC Global’s development projects in Singapore, including The Marq on Paterson Hill, Hilltops, Martin No 38, and Seven Palms at Sentosa Cove.
The three months saw gross profit margins of 48 per cent against 21 per cent a year earlier.
Earnings per share rose to 17.59 cents in Q1 2011 from 1.2 cents a year ago. The group had cash and cash equivalents of $232.1 million at the end of Q1 2011 as compared to $199 million at the end of 2010.
Looking ahead, SC Global said that while speculative and sub-sale activity may remain subdued in light of the property measures announced by the government in January 2011, there seems to be continued demand from genuine home buyers and long term investors.
In Singapore, the group’s The Marq on Paterson Hill obtained its temporary occupation permit (TOP) in January 2011, while Hilltops obtained its TOP in April 2011.
And in Shenyang, China, the next phase of the group’s development project, Kairong International Gardens, comprising 882 residential units, was successfully launched recently. Around 60 per cent of the units in that phase were sold at an average price 4,900 yuan (S$935) per square metre.
SC Global shares lost one cent to close at $1.33 yesterday.
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