MCL First Quarter 2010 Financ

RNS Number : 9918K

Hongkong Land Hldgs Ld

29 April 2010

 



To:   Business Editor                                                                                                     29th April 2010

                                                                                                                                    For immediate release

 

MCL Land Limited

First Quarter 2010 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

John R Witt                                                                                                                                  (852) 2842 8101

GolinHarris

Sue So                                                                                                                                         (852) 2501 7984

29th April 2010

MCL LAND LIMITED

FIRST QUARTER 2010 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

Highlights

·          The Estuary 98% committed following launch in February 2010

·          Impairment charge on The Estuary written back

 

"Sentiment in Singapore's residential property market remains positive, underpinned by an improving economic outlook. The Group's results for 2010 should benefit from the completion of two development projects in Singapore, Waterfall Gardens and D'Pavilion, and the write back of the impairment charge on The Estuary."

Y K Pang, Chairman

29th April 2010

Group Results

	Three months ended 31st March
	2010	2009	Change	2010	Change
	US$m	US$m	%	S$m	%
Revenue	0.2	8.3	- 97	0.3	- 98
Profit before tax	47.1	2.0	n/m	66.4	n/m
Profit attributable to shareholders	48.7	1.4	n/m	68.5	n/m
	US¢	US¢		S¢
Earnings per share	13.15	0.38	n/m	18.53	n/m
	At 31.3.2010	At 31.12.2009	Change	At 31.3.2010	Change
	US$m	US$m	%	S$m	%
Shareholders' funds	583.4	533.2	9	817.6	9
	US$	US$		S$
Net asset value per share	1.58	1.44	10	2.21	9

n/m = not meaningful

The exchange rate of US$1=S$1.40 (31.12.2009: US$1=S$1.40) was used for translating assets and liabilities at the balance sheet date. Average monthly transaction rates were used for translating the results for the financial period (average rate for 2010: US$1=S$1.40, 2009: US$1=S$1.52).

The financial results for the three months ended 31st March 2010 and 31st March 2009 have been prepared based on the International Financial Reporting Standards ("IFRS"). The financial results for 31st March 2010 have not been audited or reviewed by the Company's Auditors.

Overview

Sales momentum in the Singapore market remained strong in the first quarter of 2010 and the Company’s recent project launches met with good responses. Some 4,380 new homes were sold in the period, more than double the number sold in the previous quarter.

Group Performance

MCL Land recorded nominal revenue for the quarter ended 31st March 2010, mainly representing rental income from investment properties, compared with US$8 million in the corresponding period in 2009. Net profit attributable to shareholders for the first quarter was US$49 million primarily arising from the write back of an impairment charge of US$51 million on The Estuary.  This compares with US$1 million in the first three months of 2009. The Group continues to carry an impairment charge of US$134 million against a number of its other development properties.

Shareholders' funds were US$583 million at 31st March 2010, up from US$533 million at 31st December 2009. Progress payments received in respect of the Group's development properties continued to enhance the Group's financial position with net cash of US$140 million at 31st March 2010, compared with US$93 million at the end of 2009.  

The Board is not recommending the payment of an interim dividend for the first quarter of 2010 (2009: Nil).

Properties

Sales of the Group's development properties in Singapore continued to progress well. The Estuary, a 608-unit condominium development at Yishun Avenue 1, was successfully launched in February 2010 and 98% of the units had been committed by the end of March. By the same date, pre-sales had reached 74% at D'Pavilion, a 50-unit apartment development at Upper Serangoon Road; 96% at Parvis, a 248-unit freehold condominium joint venture development at Holland Road; and 100% at The Peak@Balmeg, a 180-unit condominium development at Balmeg Road.

Construction of the Group's various projects is progressing well. Waterfall Gardens, a fully sold 132-unit condominium development at Farrer Road, and D'Pavilion are on schedule to complete by the second and fourth quarter of 2010, respectively. The Peak@Balmeg is due to complete in 2011, followed by Parvis in 2012. D'Mira, a 65-unit apartment development at Boon Teck Road, and The Estuary are expected to be completed in 2013. In addition, the Group has four other development projects in Singapore with a total gross floor area of some 57,000 square metres that are at various stages of planning approval. It is planned to launch these development projects progressively over the next few years.

The Group's joint venture developments in Malaysia continued to perform well.  Riana Green Phase 1 was completed in January 2010, with all 391 units committed for sale as at 31st March 2010.  Sales of the development in Seremban continued with 311 of the 396 units committed for sale.

Wangsa Walk in Kuala Lumpur, a joint venture retail mall development with an estimated net lettable area of some 25,000 square metres, had 92% of its space committed for lease at the end of March 2010.

Prospects

Sentiment in Singapore's residential property market remains positive, underpinned by an improving economic outlook. The Group's results for 2010 should benefit from the completion of two development projects in Singapore, Waterfall Gardens and D'Pavilion, and the write back of the impairment charge on The Estuary.

Y K Pang

Chairman

29th April 2010

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 2010 to be false or misleading in any material respect.

On behalf of the Directors

Y K Pang

Chairman

Hassan Abas

Director

29th April 2010

MCL Land Limited
Consolidated Profit and Loss Account for the three months ended 31st March
				2010		2009		Change
		Note		US$'000		US$'000		%
Revenue		2		228		8,304		- 97
Cost of sales				(85)		(5,255)		- 98
Gross profit				143		3,049		- 95
Other income		3		51,350		331		n/m
Marketing expenses				(2,480)		(53)		n/m
Administrative expenses				(573)		(949)		- 40
Share of joint ventures' results (net of tax)				(1,305)		(409)		219
Profit before tax		2		47,135		1,969		n/m
Tax		4		1,521		(581)		n/m
Profit after tax attributable to shareholders
of the Company				48,656		1,388		n/m
				US¢		US¢		%
Earnings per share ("EPS") attributable to
shareholders
- basic and diluted*		5		13.15		0.38		n/m
n/m = not meaningful
*	Diluted EPS is the same as basic EPS, as there were no outstanding, dilutive potential ordinary shares.

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the three months ended 31st March
Consolidated Statement of Comprehensive Income for the three months ended 31st March
			2010		2009
			US$'000		US$'000
Profit after tax			48,656		1,388
Other comprehensive income/(expenses):
Translation difference			1,590		(20,974)
Total comprehensive income/(loss) attributable to shareholders
of the Company			50,246		(19,586)
Consolidated Statement of Changes in Equity for the three months ended 31st March
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2010
Balance at 1st January		276,657	120,504	136,067	533,228
Total comprehensive income for the financial period		-	1,590	48,656	50,246
Balance at 31st March		276,657	122,094	184,723	583,474
2009
Balance at 1st January		276,657	109,383	7,909	393,949
Total comprehensive (loss)/income for the financial period		-	(20,974)	1,388	(19,586)
Balance at 31st March		276,657	88,409	9,297	374,363
The number of issued ordinary shares as at 31st March 2010 was 369,985,977 (2009: 369,985,977). The Company did not hold any treasury shares as at 31st March 2010 and 2009.

MCL Land Limited
Consolidated Balance Sheet
			At		At
			31.3.2010		31.12.2009
		Note	US$'000		US$'000
Non-current assets 1
Plant and equipment			291		346
Investment properties			15,916		15,382
Investments in joint ventures			29,053		30,317
Deferred tax assets			2,027		690
			47,287		46,735
Current assets 2
Development properties for sale			608,772		543,409
Amounts owing by joint ventures			72,742		72,466
Debtors and prepayments			95,459		67,534
Bank balances			227,776		192,464
			1,004,749		875,873
Total assets			1,052,036		922,608
Non-current liabilities 3
Borrowings		6	83,186		90,194
Deferred tax liabilities			282		270
Creditors			5,813		7,254
			89,281		97,718
Current liabilities 4
Borrowings		6	4,996		9,550
Amounts owing to joint venture			483		482
Creditors			340,936		249,038
Current tax liabilities			32,866		32,592
			379,281		291,662
Total liabilities			468,562		389,380
Net assets			583,474		533,228
Equity:
Share capital and reserves
Share capital			276,657		276,657
Translation reserve			122,094		120,504
Retained earnings			184,723		136,067
Shareholders' funds			583,474		533,228
Net asset value per share			US$1.58		US$1.44

Explanatory notes on material variances:
1	The increase in non-current assets at 31.3.2010 as compared to 31.12.2009 is mainly due to higher deferred tax assets provided for marketing expenses and utilisation of prior year losses. This is partially offset by the Group's share of losses incurred by the Group's joint ventures.
2	The increase in current assets is mainly due to higher development properties for sale from the construction of D'Pavilion, The Peak@Balmeg, D'Mira and The Estuary. In addition, outstanding progress billings and sales proceeds collected from the Group's development properties resulted in higher debtors and bank balances, respectively.
3	The lower non-current liabilities at 31.3.2010 as compared to 31.12.2009 is mainly due to repayment of long-term bank loans during the financial period from progress billings collected from the Group's development properties.
4	The higher current liabilities at 31.3.2010 as compared to 31.12.2009 is mainly due to the increase in progress billings collected from the Group's development properties.

MCL Land Limited
Company Balance Sheet
	At		At
	31.3.2010		31.12.2009
	US$'000		US$'000
Non-current assets
Plant and equipment	270		325
Interests in subsidiaries	57,643		57,561
Investments in joint ventures	28,523		28,482
	86,436		86,368
Current assets
Amounts owing by subsidiaries	341,348		273,493
Amounts owing by joint ventures	72,742		72,466
Debtors and prepayments	272		318
Bank balances	149,495		135,281
	563,857		481,558
Total assets	650,293		567,926
Current liabilities
Amounts owing to subsidiaries	152,887		126,061
Amounts owing to joint venture	483		482
Creditors	2,500		3,734
Current tax liabilities	933		721
	156,803		130,998
Total liabilities	156,803		130,998
Net assets	493,490		436,928
Equity:
Share capital and reserves
Share capital	276,657		276,657
Translation reserve	102,857		102,236
Retained earnings	113,976		58,035
Shareholders' funds	493,490		436,928
Net asset value per share	US$1.33		US$1.18

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the three months ended 31st March
Company Statement of Comprehensive Income for the three months ended 31st March
				2010		2009
				US$'000		US$'000
Profit/(Loss) after tax				55,941		(51,205)
Other comprehensive income/(expenses):
	Translation difference			621		(25,509)
Total comprehensive income/(loss) attributable to shareholders
	of the Company			56,562		(76,714)
Company Statement of Changes in Equity for the three months ended 31st March
		Attributable to shareholders
		Share	Translation	Retained		Total
		capital	reserve	earnings		equity
		US$'000	US$'000	US$'000		US$'000
2010
Balance at 1st January		276,657	102,236	58,035		436,928
Total comprehensive income for the financial period		-	621	55,941		56,562
Balance at 31st March		276,657	102,857	113,976		493,490
2009
Balance at 1st January		276,657	96,048	104,815		477,520
Total comprehensive loss for the financial period		-	(25,509)	(51,205)		(76,714)
Balance at 31st March		276,657	70,539	53,610		400,806

MCL Land Limited
Consolidated Statement of Cash Flows for the three months ended 31st March
					2010		2009
			Note		US$'000		US$'000
Profit before tax					47,135		1,969
Non-cash items
		Interest income			(246)		(302)
		Share of joint ventures' results			1,305		409
		Depreciation			26		37
		Write back of impairment charge on development    properties for sale	3		(50,897)		-
		Profit on disposal of plant & equipment			(21)		-
		Unrealised translation losses			1		-
					(49,832)		144
Operating (loss)/profit before working capital changes					(2,697)		2,113
Changes in working capital
		Development properties for sale			(13,439)		(17,498)
		Amounts owing by joint ventures			(173)		(1,041)
		Debtors and prepayments			(27,651)		11,277
		Creditors			90,022		15,571
					48,759		8,309
Cash flows generated from operations					46,062		10,422
		Interest received			127		294
		Income tax refunded/(paid)			412		(609)
					539		(315)
		Net cash flows generated from operating activities 5			46,601		10,107
Cash flows from investing activities
		Purchase of plant and equipment			(5)		(2)
		Net proceeds from sale of plant and equipment			57		-
		Net cash flows generated from/(used in) investing activities			52		(2)
Cash flows from financing activities
		Drawdown of loans			-		297
		Repayment of loans			(11,682)		(33,856)
		Net cash flows used in financing activities 6			(11,682)		(33,559)
Net change in cash and cash equivalents					34,971		(23,454)
Cash and cash equivalents at the beginning of the financial period					192,464		131,800
Effect of exchange rate changes					341		(6,997)
Cash and cash equivalents at the end of the financial period					227,776		101,349

Explanatory notes on material variances:
	5	The net cash flows generated from operating activities for the period ended 31st March 2010 relate mainly to increased progress billings in respect of the Group's development properties, partially offset by increased progress billings not yet received.
	6	The net cash flows used in financing activities for the period ended 31st March 2010 relate mainly to long-term bank loans repaid from collected progress billings.

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 2009 audited accounts, which are based on International Financial Reporting Standards ("IFRS").  There have been no changes to the accounting policies set out in the 2009 audited accounts except for the adoption of standards, amendments and interpretations to existing standards which are relevant to its operations as set out below:
	Amendment to IFRS 2	Group Cash-settled Share-based Payment Transactions
	Amendment to IFRS 5	Non-current Assets Held for Sale and Discontinued Operations
	Amendment to IAS 1	Presentation of Financial Statements
	Amendment to IAS 39	Eligible Hedged Items
	IFRIC 17	Distribution of Non-cash Assets to Owners
	The adoption of the above amendments and interpretations did not have a material impact on the results of the Group.

2	Profit
				Group
	For the three months ended 31st March			2010		2009		Change
				US$'000		US$'000		%
	Profit before tax is determined after including:
	Write back of impairment charge on development
		properties for sale (Note 3)		50,897		-		n/m
	Net exchange gain			2		1		100
	Rental income			228		267		-  15
	Interest income			246		302		-  19
	Profit on disposal of plant and equipment			21		-		n/m
	Depreciation on plant and equipment			(24)		(37)		-  35
	n/m = not meaningful

3	Other income
	Included in the income for the three months ended 31st March 2010 is a write back of an impairment charge on the Group's development properties for sale amounting to US$50,897,000 (2009: Nil).
4	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.

5	Earnings per share *
							Group
	For the three months ended 31st March						2010		2009
	Basic earnings per share*
	Profit attributable to shareholders (US$'000)						48,656		1,388
	Weighted average number of ordinary shares in issue ('000)						369,986		369,986
	Basic earnings per share (US¢)						13.15		0.38
	*	Diluted EPS is the same as basic EPS, as there were no outstanding, dilutive potential ordinary shares.

6	Group borrowings
							Group
							At		At
							31.3.2010		31.12.2009
							US$'000		US$'000
	Borrowings due within one year
		-  secured					4,996		9,550
	Borrowings due after one year
		-  secured					83,186		90,194
							88,182		99,744
	Certain subsidiaries of the Company have mortgaged their development properties as security for bank loans.  The net book value of properties mortgaged as at 31st March 2010 was US$261.2 million (31st December 2009: US$289.9 million).

7	Interested person transactions
	Name of interested person	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)

			US$'000				US$'000
	Three months ended 31st March 2010		-				-

8	Issue of shares
	There have been no changes in the issued share capital of the Company since 31st December 2009.
	There are no outstanding convertible instruments issued or treasury shares held by the Company as at 31st March 2010.
	The total number of issued shares (excluding treasury shares) as at 31st March 2010 and 31st December 2009 was 369,985,977.
9	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 31st March 2010 and the date of this report.

 - ends -

For further information, please contact:

Steve Chu

Chief Financial Officer

MCL Land Limited

Tel: [phone]

Full text of the Financial Statements and Dividend Announcement for the three months ended 31st March 2010 can be accessed through the internet at www.mclland.com.sg.

 

END

 

 

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