Straits Trading posts 13% fall in Q3 net profit to S$12.2m

THE Straits Trading Company on Thursday posted a 13.2 per cent drop in net profit to S$12.2 million for its third quarter ended Sept 30, due to a halving in earnings from its real estate segment, despite a more profitable resources division.

The lower contribution for the group's real estate segment, from S$14 million a year ago to S$6.9 million in the latest reporting period, was mainly due to lower interest income from the notes issued by a joint venture, it said.

Straits Trading's real estate segment comprises the property portfolio and investments in Straits Real Estate, Suntec Reit and ARA Asset Management.

The resources segment recorded higher profit - S$5.8 million, versus S$2.1 million a year ago - due to a reversal of tribute provisions. This was partially offset by the writedown of tin inventories to net realisable value due to lower tin prices and soft global demand. 

Revenue for the investment company fell 35.3 per cent to S$67.3 million, with lower contribution coming from its resources segment.

The company also has a hospitality segment comprising its investments in Far East Hospitality Holdings and Far East Hospitality Trust (FEHT), although its entire investment in FEHT was disposed of in the third quarter of 2019.