SingHaiyi sinks into the red with S$4.6m Q2 loss

PROPERTY developer SingHaiyi Group has swung to a net loss of S$4.6 million for its second quarter ended Sept 30, from a net profit of S$7.7 million a year ago.

This was mainly due to a slide in revenue from the decrease in recognised contributions for several projects. Finance costs for the quarter was also over seven times that of the year-ago period. 

Loss per share (LPS) stood at 0.109 Singapore cent for the quarter, compared with an earnings per share (EPS) of 0.179 cent a year ago, the group said in a regulatory filing on Wednesday.

Revenue for the second quarter of fiscal 2020 dropped 63.7 per cent to S$8.8 million, from S$24.2 million a year ago. This was mainly due to the fall in revenue recognised for Vietnam Town phase two of S$9.2 million, and City Suites of S$3.8 million.

In the quarter, revenue came mainly from the sales of Vietnam Town phase two of S$3.7 million, progressive revenue recognised for The Gazania of S$2.6 million and rental income from Tri-County Mall.

Cost of sales decreased by S$11.0 million year on year, in line with the decrease in property development income.

Property development income was S$6.9 million, down 68.7 per cent from S$22.0 million a year ago. Rental income stood at S$1.5 million, down 6.4 per cent from S$1.8 million the year prior.

Meanwhile, management fee income was S$383,000, down 6.4 per cent from S$409,000 the year prior.

Finance costs for the quarter rose to S$9.9 million, more than seven times the S$1.3 million recorded a year ago, mainly due to the increase in bank borrowings.  

No dividend was declared for the quarter, unchanged from a year ago.

For the half year ended Sept 30, the group posted a net loss of S$12.8 million, from a net profit of S$8.9 million a year ago.

Meanwhile, revenue fell 74.3 per cent to S$12.9 million, from S$50.3 million a year ago, due to the drop in revenue recognised for Vietnam Town phase two of S$7.1 million and City Suites of S$21.5 million and The Vales of S$7.2 million.

Cost of sales decreased by S$32.1 million year on year, in line with the decrease in property development income.

In the first half, revenue mainly came from the sales of Vietnam Town phase two of S$5.8 million, progressive revenue recognised for The Gazania of S$2.6 million and rental income from Tri-County Mall.

LPS for the first half stood at 0.302 Singapore cent, compared with an EPS of 0.208 cent.

Property development income was S$9.0 million, down 80.3 per cent from S$45.8 million a year ago. Rental income stood at S$3.1 million, down 13.9 per cent from S$3.6 million the year prior.

Meanwhile, management fee income was S$786,000, down 3.3 per cent from S$813,000 the year prior.

On its outlook, the group said it remains "cautiously optimistic" and will focus on driving sales and ensuring the smooth execution of its three recently launched properties in Singapore - Parc Clematis, The Gazania and The Lilium.

Together with its US property development projects, SingHaiyi said it has a strong pipeline of projects extending up to 2024, which are expected to contribute to the profitability of the group.

"The group will continue to remain selective and prudently explore for fairly valued-land plots with good location and pursue suitable growth opportunities through yield-accretive acquisitions," it said.

SingHaiyi shares were trading at 9.3 Singapore cents, down 0.1 cent or 1.1 per cent as at 1.33pm after the results were announced.