Source : Straits Times - 1 Nov 2008
PROPERTY giant CapitaLand has the resources and rainy-day cash to ride out the economic downturn as well as snap up any buying opportunities that might arise, it said yesterday.
The firm, which reported disappointing third-quarter results, said at a results briefing that it is prepared for more turbulence.
Chairman Richard Hu said: ‘CapitaLand is well positioned to ride out the global financial and economic uncertainties. It has the strong balance sheet, liquidity and diversified sources of funding necessary to act on investment opportunities that will arise in the current capital-constrained environment.
‘The group has also built up a portfolio of investment and development properties in its various private equity funds and joint ventures. At the right time, they can be monetised for good returns to our shareholders.’
Chief executive Liew Mun Leong said: ‘With the situation deteriorating rapidly, we are strategically watching the distressed markets, very carefully seeking out opportunities.’
Net profit for the three months to Sept 30 fell from $563.9 million last year to $419.4 million, a decline of 25.6 per cent.
Revenue also dived, down 33.3 per cent at $597.2 million.
Profits were hit by impairment losses on some investments in Japan and China and higher finance costs but divestment gains and higher fee-based income and rents prevented a steeper drop in earnings.
Lower sales from it projects hit turnover, particularly in China, where fewer projects were released for sale. CapitaLand China Holdings illustrated that with a 72.4 per cent plunge in revenue from last year to $83.3 million.
One landmark was that net profit for the nine months reached $1.18 billion, ‘a significant achievement in view of the difficult market conditions’, the firm said.
Earnings per share for the third quarter was 14.9 cents, down from 20.1 cents last year, while net asset value as at Sept 30 was $3.81, up from $3.54 at Dec 31.
CapitaLand shares closed unchanged at $2.85 yesterday.
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