1st Quarter Results

RNS Number : 3190R

Hongkong Land Hldgs Ld

28 April 2009

 



For Immediate release

29th April 2009

MCL Land Limited

First Quarter 2009 Financial Statements and Dividend Announcement

The following announcement was issued today by the Company's 77%-owned subsidiary, MCL Land Limited.

For further information, please contact:

Hongkong Land Limited
Y K Pang	(852) 2842 8428
G M Brown	(852) 2842 8138
	(852) 9612 3496
GolinHarris
Sue So	(852) 2501 7984

  29th April 2009

MCL LAND LIMITED

FIRST QUARTER 2009 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

Highlights

·	The Fernhill completes in March
·	Profit attributable to shareholders US$1.4 million

'The outlook for the residential property markets in Singapore and Malaysia remains uncertain, despite the recent pick up in sales of mass market residential properties in Singapore. Nevertheless, the Group's results for 2009 should benefit from the completion of two further development projects in Singapore, Tierra Vue and Hillcrest Villa. With strong cash flow generated from the sale of development properties and a healthy balance sheet, the Group is well placed to weather the difficult economic and market conditions.'

Y K Pang, Chairman

29th April 2009

Group Results
			Three months ended 31 March
			2009	2008	Change	2009	Change
			US$m	US$m	%	S$m	%
Revenue			8.3	0.4	n/m	12.6	n/m
Profit before tax			2.0	5.1	- 62	3.0	- 58
Profit attributable to shareholders			1.4	5.0	- 72	2.1	- 70
			US¢	US¢		S¢
Earnings per share			0.38	1.36	- 72	0.57	- 70
			At 31.3.2009	At 31.12.2008	Change	At 31.3.2009	Change
			US$m	US$m	%	S$m	%
Shareholders' funds			374.4	393.9	- 5	569.1	-
			US$	US$		S$
Net asset value per share			1.01	1.06	- 5	1.54	1

The exchange rate of US$1=S$1.52 (31.12.2008: US$1=S$1.44) was used for translating assets and liabilities at the balance sheet date and average monthly transaction rates of US$1=S$1.52 (2008: US$1=S$1.41) was used for translating the results for the financial period.

The financial results for the three months ended 31stMarch 2009 and 31stMarch 2008 have been prepared based on the International Financial Reporting Standards ('IFRS'). The financial results for 31st March 2009 have not been audited or reviewed by the Auditors.

  Overview

Overall market sentiment in the residential property market in Singapore remained subdued in the first quarter of 2009 as prices continued to fall in the face of weak market sentiment and a poor economic outlook. Sales of new residential properties, however, increased to 2,596 units, more than five times higher than that of the previous quarter, following a good response to mass market projects that were affordably priced and well located.

Group Performance

MCL Land recorded revenue of US$8.3 million for the quarter ended 31st March 2009, representing mainly the sale of five units in The Fernhill. This compares with US$0.4 million in the corresponding period in 2008, which represented mainly rental income from investment properties. Profit for the first quarter was US$1.4 million, compared with US$5.0 million in the first three months of 2008.

Shareholders' funds were US$374 million at the end of March 2009, down from US$394 million at 31st December 2008. The Group's net debt at 31st March 2009 was US$161 million, compared with US$181 million at the end of 2008. Net gearing was 43% at the quarter end, down from 46% at the end of 2008.

The Board is not recommending the payment of an interim dividend for the first quarter of 2009 (2008: nil).

Properties 

No new development projects were launched in Singapore during the period under review. D'Pavilion, a 50-unit apartment development at Upper Serangoon Road, had 28% of the units committed as at 31st March 2009, while The Peak@Balmeg, a 180-unit condominium development, had 25% of its units committed. All other developments launched previously have been fully pre-sold, with the exception of two units at Hillcrest Villa. 

The Fernhill obtained its Temporary Occupation Permit in March 2009. The purchasers of five of the 25 units paid the outstanding purchase price by the payment date, and this has been recognised in the results for the first quarter. The en-bloc purchaser of the remaining 20 units did not make the necessary payments, and the relevant revenue and profit was not recognised in the period. Had The Fernhill been paid in full, the revenue for the first quarter would have been US$31.0 million higher and the profit would have been US$9.3 million higher.

Construction of the Group's various projects is progressing well. Tierra Vue and Hillcrest Villa are on track to complete by the second and fourth quarters of 2009, respectively. Waterfall Gardens and D'Pavilion are scheduled to complete in 2010, followed by The Peak@Balmeg in 2011. In addition, the Group has seven development projects in Singapore with a total gross floor area of about 158,000 square metres that are at various stages of planning approval. These development projects are planned to be launched progressively over the next few years.

The Group's joint venture developments in Malaysia continued to perform satisfactorily. Riana Green Phase 1 had 93% of the units committed for sale as at 31st March 2009. Sales of the joint venture development in Seremban continued with 142 of the 270 terrace houses, bungalows, bungalow lots and shop offices committed for sale.

Construction of Wangsa Walk in Kuala Lumpur, a retail mall development by the Group's joint venture company, MSL Properties, is progressing well. The development is on schedule to complete by third quarter of 2009 with an estimated net lettable area of some 25,000 square metres, of which some 90% has been pre-committed.

Prospects

The outlook for the residential property markets in Singapore and Malaysia remains uncertain, despite the recent pick up in sales of mass market residential properties in Singapore. Nevertheless, the Group's results for 2009 should benefit from the completion of two further development projects in Singapore, Tierra Vue and Hillcrest Villa. With strong cash flow generated from the sale of development properties and a healthy balance sheet, the Group is well placed to weather the difficult economic and market conditions.

Y K Pang

Chairman

29th April 2009    

  Statement pursuant to Rule 705(5) of the Listing Manual    

The directors confirm that, to the best of their knowledge, nothing has come to the attention of the Board of Directors which may render the accompanying unaudited interim financial results for the three months ended 31st March 2009 to be false or misleading in any material respect.

On behalf of the Directors

Y K Pang

Chairman

Hassan Abas

Director

29th April 2009    

MCL Land Limited
Consolidated Profit and Loss Account for the three months ended 31 March
				2009			2008		Change
		Note		US$'000			US$'000		%
Revenue				8,304			365		n/m
Cost of sales				(5,162)			-		n/m
Gross profit				3,142			365		n/m
Other operating income				331			510		- 35
Property related expenses				(146)			(177)		- 18
Administrative expenses				(949)			(515)		84
Share of joint ventures' results				(409)			4,941		n/m
Profit before tax		2		1,969			5,124		- 62
Tax		3		(581)			(110)		428
Profit after tax attributable to shareholders				1,388			5,014		- 72
				US¢			US¢		%
Earnings per share ('EPS') attributable to
	shareholders
	- basic and diluted*	4		0.38			1.36		- 72
n/m = not meaningful
*	Diluted EPS is the same as basic EPS, as there were no outstanding share options.

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity for the three months ended 31 March
Consolidated Statement of Comprehensive Income for the three months ended 31 March
			2009		2008
			US$'000		US$'000
Profit after tax			1,388		5,014
Translation difference			(20,974)		24,136
Total comprehensive (loss)/income attributable to shareholders			(19,586)		29,150
Consolidated Statement of Changes in Equity for the three months ended 31 March
		Attributable to shareholders
		Share	Translation	Retained	Total
		Capital	Reserve	Earnings	Equity
		US$'000	US$'000	US$'000	US$'000
2009
Balance at 1 January		276,657	109,383	7,909	393,949
Comprehensive (loss)/income for the financial period		-	(20,974)	1,388	(19,586)
Balance at 31 March		276,657	88,409	9,297	374,363
2008
Balance at 1 January		276,657	105,228	142,288	524,173
Comprehensive income for the financial period		-	24,136	5,014	29,150
Balance at 31 March		276,657	129,364	147,302	553,323

MCL Land Limited
Consolidated Balance Sheet
								At		At
								31.3.2009		31.12.2008
						Note		US$'000		US$'000
Non-current assets 1
Plant and equipment								166		212
Investment properties								15,196		15,985
Investments in joint ventures								32,475		34,739
Deferred tax assets								792		874
								48,629		51,810
Current assets 2
Development properties for sale								664,671		683,534
Amounts owing by joint ventures								59,740		62,018
Debtors and prepayments								65,323		80,797
Bank balances								101,349		131,800
								891,083		958,149
Total assets								939,712		1,009,959
Non-current liabilities 3
Borrowings						5		240,738		298,242
Deferred tax liabilities								437		459
Creditors								331		-
Retention money payable								6,823		7,137
								248,329		305,838
Current liabilities 4
Borrowings						5		22,069		14,871
Amounts owing to joint venture								434		459
Creditors								278,101		277,437
Current tax liabilities								16,416		17,405
								317,020		310,172
Total liabilities								565,349		616,010
Net assets								374,363		393,949
Equity:
Share capital and reserves
Share capital								276,657		276,657
Translation reserve								88,409		109,383
Retained earnings								9,297		7,909
Shareholders' funds								374,363		393,949
Net asset value per share								US$1.01		US$1.06
Explanatory notes on material variances:
1	The decrease in non-current assets at 31.3.2009 as compared to 31.12.2008 is mainly due to the loss incurred from the Group's joint ventures and translation loss.
2	The decrease in current assets is mainly due to lower bank balances arising from the repayment of bank loans, lower development properties for sale from the completion of The Fernhill in March 2009 and progress billings received from the Group's completed projects.
3	The lower non-current liabilities at 31.3.2009 as compared to 31.12.2008 is mainly due to repayment of long-term bank loans during the financial period from progress billings collected from the Group's completed projects.
4	The higher current liabilities at 31.3.2009 as compared to 31.12.2008 is mainly due to the increase in short-term bank loans during the financial period.

MCL Land Limited
Company Balance Sheet
							At		At
							31.3.2009		31.12.2008
							US$'000		US$'000
Non-current assets
Plant and equipment							141		182
Interests in subsidiaries							55,105		58,909
Investments in joint ventures							26,290		27,773
							81,536		86,864
Current assets
Amounts owing by subsidiaries							301,470		353,289
Amounts owing by joint ventures							59,740		62,018
Debtors and prepayments							265		280
Bank balances							43,161		70,916
							404,636		486,503
Total assets							486,172		573,367
Non-current liability
Borrowings							42,758		45,170
Current liabilities
Borrowings							-		9,034
Amounts owing to subsidiaries							37,550		35,564
Amounts owing to joint venture							434		459
Creditors							2,982		3,336
Current tax liabilities							1,642		2,284
							42,608		50,677
Total liabilities							85,366		95,847
Net assets							400,806		477,520
Equity:
Share capital and reserves
Share capital							276,657		276,657
Translation reserve							70,539		96,048
Retained earnings							53,610		104,815
Shareholders' funds							400,806		477,520
Net asset value per share							US$1.08		US$1.29

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity for the three months ended 31 March
Company Statement of Comprehensive Income for the three months ended 31 March
					2009				2008
					US$'000				US$'000
Loss after tax					(51,205)				(344)
Translation difference					(25,509)				21,041
Total comprehensive (loss)/income attributable to shareholders					(76,714)				20,697
Company Statement of Changes in Equity for the three months ended 31 March
		Attributable to shareholders
		Share		Translation			Retained			Total
		Capital		Reserve			Earnings			Equity
		US$'000		US$'000			US$'000			US$'000
2009
Balance at 1 January		276,657		96,048			104,815			477,520
Comprehensive loss for the financial period		-		(25,509)			(51,205)			(76,714)
Balance at 31 March		276,657		70,539			53,610			400,806
2008
Balance at 1 January		276,657		93,361			84,954			454,972
Comprehensive income/(loss) for the financial period		-		21,041			(344)			20,697
Balance at 31 March		276,657		114,402			84,610			475,669

MCL Land Limited
Consolidated Statement of Cash Flows for the three months ended 31 March
					2009		2008
					US$'000		US$'000
Profit before tax					1,969		5,124
Non-cash items
		Interest income			(302)		(423)
		Share of joint ventures' results			409		(4,941)
		Depreciation			37		43
		Unrealised translation losses			-		1
					144		(5,320)
Operating profit/(loss) before working capital changes					2,113		(196)
Changes in working capital
		Development properties for sale			(16,210)		(85,964)
		Amounts owing by joint ventures			(1,041)		332
		Debtors and prepayments			11,277		113,960
		Creditors			15,571		18,148
					9,597		46,476
Cash flows generated from operations					11,710		46,280
		Interest paid			(1,288)		(2,106)
		Interest received			294		472
		Income tax paid			(609)		(40)
					(1,603)		(1,674)
		Net cash flows generated from operating activities 5			10,107		44,606
Cash flows from investing activities
		Purchase of plant and equipment			(2)		(10)
		Net cash flows used in investing activities			(2)		(10)
Cash flows from financing activities
		Drawdown of loans			297		58,263
		Repayment of loans			(33,856)		(94,343)
		Net cash flows used in financing activities 6			(33,559)		(36,080)
Net change in cash and cash equivalents					(23,454)		8,516
Cash and cash equivalents at the beginning of the financial period					131,800		78,419
Effect of exchange rate changes					(6,997)		4,345
Cash and cash equivalents at the end of the financial period					101,349		91,280
Explanatory notes on material variances:
	5	The net cash flows generated from operating activities for the financial period ended 31 March 2009 relates mainly to lower development costs incurred for on-going projects and advances to joint ventures.
	6	The net cash flows used in financing activities for the financial period ended 31 March 2009 relates mainly to long-term bank loans repaid from the progress billings collected from the Group's completed projects.

MCL Land Limited

Notes

1

Accounting policies and basis of preparation

The financial statements contained in this announcement are prepared in accordance with the accounting policies and methods of computation set out in the 2008 audited accounts, which are based on International Financial Reporting Standards ('IFRS'). There have been no changes to the accounting policies set out in the 2008 audited accounts except for the adoption of the new standards, amendments and interpretations shown below:

IAS 1 (Revised)

Presentation of Financial Statements

Amendment to IAS 19

Employee Benefits

Amendment to IAS 23

Borrowing Costs

Amendment to IAS 36

Impairment of Assets

Amendment to IAS 38

Intangible Assets

Amendment to IAS 40

Investment Property

Amendment to IFRS 2

Share-based Payment

Amendment to IFRS 7

Improving Disclosures about Financial Instruments

IFRS 8

Operating Segments

IFRIC 15

Agreements for Construction of Real Estate

IFRIC 16

Hedges of a Net Investment in a Foreign Operation

The adoption of the above standards, amendments and interpretations did not have a material impact on the results of the Group.

2

Profit

Group

For the three months ended 31 March

2009

2008

Change

US$'000

US$'000

%

Profit before tax is determined after including:

Net exchange gain

1

14

- 93

Rental income

267

365

- 27

Interest income

302

423

- 29

Depreciation on plant and equipment

(37)

(43)

- 14

n/m = not meaningful

3

Tax

The provision for income tax is based on the statutory tax rates prevailing in the respective countries in which Group companies operate after taking into account expenses which are not tax deductible, income not subject to tax and Group tax relief.

4	Earnings per share *
					Group
	For the three months ended 31 March				2009				2008
	Basic earnings per share*
	Profit attributable to shareholders (US$'000)				1,388				5,014
	Weighted average number of ordinary shares in issue ('000)				369,986				369,986
	Basic earnings per share (US¢)				0.38				1.36
	* Diluted EPS is the same as basic EPS, as there were no outstanding share options.
5	Group borrowings
					Group
					At				At
					31.3.2009				31.3.2008
					US$'000				US$'000
	Borrowings due within one year
		- unsecured			-				9,034
		- secured			22,069				5,837
					22,069				14,871
	Borrowings due after one year
		- unsecured			42,757				45,170
		- secured			197,981				253,072
					240,738				298,242
					262,807				313,113
	Certain subsidiaries of the Company have mortgaged their development properties as security for bank loans. The net book value of properties mortgaged as at 31 March 2009 was US$277.5 million (31 December 2008: US$296.6 million).

6	Interested person transactions
			Aggregate value of all interested person transactions (excluding transactions less than S$100,000 and transactions conducted under the shareholders' mandate pursuant to Rule 920)					Aggregate value of interested person transactions conducted under shareholders' mandate pursuant to Rule 920 (excluding transactions less than S$100,000)
	Name of interested person
					US$'000				US$'000
	Three months ended 31 March 2009
	Jardine Matheson Limited
	- Internal audit fee				-				69
7	Issue of shares
	There have been no changes in the issued share capital of the Company since 31 December 2008.
	There are no outstanding convertibles issued or treasury shares held by the Company as at 31 March 2009.
	The total number of issued share capital (excluding treasury shares) as at 31 March 2009 and 31 December 2008 was 369,985,977.
8	Others
	The results do not include any pre-acquisition profits and have not been affected by any item, transaction or event of a material and unusual nature. No significant transaction or event has occurred between 31 March 2009 and the date of this report.
	- end -
For further information, please contact:
MCL Land Limited
Steve Chu
Full text of the Financial Statements and Dividend Announcement for the three months ended 31 March 2009 can be accessed through the internet at www.mclland.com.sg.

 

END

 

 

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