Developers report drop in revenue

Source : Straits Times - 1 Aug 2008

TWO property developers have reported a drop in second-quarter revenue, saying poor sentiment in the property market has led to lower sales - a trend that is likely to continue for the rest of the year.

Allgreen Properties yesterday posted a 39.1 per cent drop in revenue to $74.1 million for the three months to June 30. Net profit fell 36.5 per cent to $17.2 million.

It said continuing weak market sentiment was due to the US sub-prime issue, escalating oil prices and inflationary pressure. It expects this to persist in the second half, resulting in lower profits, but believes it will stay profitable for the year.

Allgreen’s earnings per share for the quarter slipped to 1.08 cents, from 1.74 cents a year earlier. Net asset value eased to $1.38 as at June 30, from $1.40 as at Dec 31.

Meanwhile, MCL Land’s revenue plunged in the second quarter to US$353,000 (S$482,000), from US$133.5 million last year. But the group’s net profit rose 45 per cent in the quarter to US$3.2 million, thanks to a write-back. Earnings per share rose 43 per cent to 0.86 US cents, while net asset value per share inched up to US$1.45 as at June 30, from US$1.42 as at Dec 31.

MCL Land expects the completion of Mera Springs and The Esta in the second half to boost its overall performance.