UOL Q3 profit up 44 per cent

(Abstract from Business Times 14th Nov, 2009 by Kalpana Rashiwala)

Increase due to gains from Nassim Park Residences, associate UIC

UOL Group's third-quarter net profit has risen 44 per cent year on year to $105.6 million. Revenue increased 21 per cent to $323.9 million, thanks to progressive recognition of revenue from development properties.

UOL's bottom line received a fillip from a tripling in share of profits of associated companies to $48.2 million from $15.1 million for Q3 2008.

This was on the back of higher contributions from the progressive completion of Nassim Park Residences (in which UOL has a half share) and UOL's 31.9 per cent share of the profit of United Industrial Corporation, which became an associated company this year.

Revenue from property development rose 49 per cent to $203.5 million, accounting for nearly two-thirds of total group revenue. Among the projects that contributed to UOL's Q3 report card were two new launches this year - Double Bay Residences and Meadows@Peirce, which have sold a total of 937 units to date.

Rental income from investment properties rose 9 per cent on the back of higher occupancy and rental reversions for most of the group's investment properties. However, revenue from hotel operations fell 13 per cent amid the decline in tourism markets.

UOL group chief executive Gwee Lian Kheng said: 'Our development profit showed a significant increase, attributed to our timely launches and locking in and controlling of construction costs.'

In the first nine months of 2009, UOL's net profit rose 60 per cent to $417.2 million. Revenue increased 15 per cent to $734.3 million. Shareholder funds rose 19 per cent to $4.04 billion as at Sept 30, 2009 - on the back of fair-value gains on available-for-sale financial assets, the group's operating profits for the first nine months of this year, and recognition of negative goodwill and capital reserves arising from the acquisition of additional interest in UIC. Consequently, net tangible asset backing per share rose to $5.11, from $4.22 at end-2008. UOL's gearing ratio improved to 0.39 from 0.42 over the same period.

UOL's hotel arm, Pan Pacific Hotels Group (formerly known as Hotel Plaza), posted a 25 per cent year-on-year drop in Q3 net earnings to $10.1 million on a 6 per cent dip in revenue to $72.8 million.

Nine-month net profit slid 39 per cent to almost $27 million. Revenue fell 12 per cent to $205.1 million. Pan Pacific said that it expects the business climate to remain challenging.

In the stock market yesterday, UOL closed unchanged at $3.29 yesterday while Pan Pacific Hotels ended one cent higher at $1.35.

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