The property developer&rsquo s half-year revenue tumbles 85% to S$38.7 million, from S$257.9 million the previous year

[SINGAPORE] Property developer Low Keng Huat has sunk into the red with a net loss of S$10.2 million for its first half ended Jul 31, compared with a net profit of S$5.8 million in the previous corresponding period. 

 

Its drop in revenue was mainly driven by the tail-end of the Klimt Cairnhill project. With all units already sold, only the final 1 per cent of the project&rsquo s revenue was recognised in the current period, as the development reached 99 per cent completion, the company said in a bourse filing on Thursday (Sep 11).

 

In contrast, the higher revenue booked in the year-ago period came from faster construction progress and the sale of 31 additional units. By July 31, 2024, the project was 82 per cent complete, and had sold 121 of its 138 units.

 

The group&rsquo s profitability was further hit by a fair-value loss on financial assets at fair-value profit or loss, net foreign exchange losses and higher tax expenses associated with the temporary occupation permit for the Klimt Cainhill project. 

 

Loss per share stood at 1.38 Singapore cents per share for the half-year period, from earnings per share of 0.78 cent in the previous year.

 

Revenue tumbled 85 per cent to S$38.7 million, from S$257.9 million the previous year. Aside from the lower contributions to the property development segment from the Cairnhill project, the group also booked revenue declines in its remaining two hotel and investment segments. 

 

No dividend was declared for the half-year, unchanged from the year before. 

 

Most of the decreases were recorded in its hotel and investment segments. Revenue from the hotel segment fell to S$22.6 million, from S$23 million, driven primarily by lower revenue at Lyf @ Farrer, due to lower average daily rates and occupancy. 

 

Citadines Balestier also recorded a decline in revenue due to lower average daily rates, despite higher occupancy. 

 

Separately, revenue from the investment segment fell to S$9.2 million, from S$9.5 million. 

 

The drop was mainly due to the exit of a tenant in Paya Lebar Square retail mall, which hit overall income, though this was partially offset by positive rental reversions from other tenants. 

 

Presenting its outlook, the company said that the outlook for property developers remains &ldquo stable but cautious&rdquo amid ongoing global and domestic uncertainties. 

 

&ldquo Developers may adjust prices in response to softer demand,&rdquo it added. &ldquo Still, recent government land sales have sparked increased interest in selective sites, indicating a measured appetite for future projects.&rdquo  

 

Further, while interest rates are easing, buyers are expected to remain discerning.

 

With the completion of the Klimt Cairnhill project, revenue from the development segment is expected to decline in FY2026. To drive future growth, the group &ndash together with a joint venture partner &ndash secured a residential site in Canberra Crescent in August 2024, holding a 30 per cent equity stake. 

 

The project, Canberra Crescent Residences, was launched in July 2025. More than half the units have been sold to date. In parallel, the group continues to explore new acquisitions and investments and expand its land bank, to ensure sustainable shareholder returns amid a shifting economic landscape.  

 

Separately, for the hotel segment, the Duxton Hotel Perth is expected to benefit from ongoing refurbishment works. But growth in the serviced apartment segment will likely remain modest. 

 

Meanwhile, the retail mall Paya Lebar Square continues to maintain healthy occupancy levels, despite softer consumer spending, increased outbound travel and intensifying e-commerce competition. The mall&rsquo s operational performance is expected to remain resilient. 

Mainboard-listed Low Keng Huat has reported earnings of $5.8 million for 1HFY2025 ended July 31, reversing from its $1.5 million loss in 1HFY2024.

 

Revenue for the six-month period rose by 34% y-o-y to $257.9 million due to higher revenues from the company&rsquo s property development and hotel businesses and offset by lower contributions from its investment business.

 

Revenue from the company&rsquo s property development segment increased to $225.4 million from $156.6 million due to a higher percentage of completion for the Klimt Cairnhill project. In 1HFY2025, the project was 25% completed compared to 8% in 1HFY2024. The company also sold more units with 121 sold as of July 31 from 66 units in July 31, 2023.

 

Revenue from Low Keng Huat&rsquo s hotel segment rose to $23 million in 1HFY2025 from $22.5 million due mainly to higher revenue at Duxton Hotel Perth. The hotel saw improved occupancy and better average daily rates (ADR). Lyf@Farrer also saw an increase in revenue due to higher ADRs. Meanwhile Citadines Balestier saw a decline in revenue from lower ADRs. Occupancy rates at the company&rsquo s two serviced apartments remained stable y-o-y.

 

Revenue from investments fell to $9.5 million from $13.6 million due to the absence of construction revenue after the Dalvey Haus project was completed. Dalvey Haus contributed $4.4 million in revenue in 1HFY2024.

 

Cost of sales increased by 37% y-o-y to $222.4 million due mainly to higher costs recognised for the Klimt Cairnhill project.

 

Gross profit was up by 16% y-o-y to $35.5 million mainly from the higher contributions from the property development and investment segments due to the better performance from the Klimt Cairnhill project and Paya Lebar Square. Gross profit from the company&rsquo s hotel segment fell due to weaker contributions from Citadines Balestier and F& B outlet Carnivore Brazilian Churrascaria.

 

Gross profit margin fell to 14%, down two percentage points y-o-y due to a higher percentage of gross profit contribution from the property development segment, which had a lower margin compared to the other two segments.

 

As at July 31, cash and cash equivalents stood at $71.6 million.

 

MAINBOARD-LISTED property firm Low Keng Huat (Singapore) : F1E +3.49% has sunk into the red with a S$24.1 million loss for the half year to July, from a S$25.1 million net profit in the year-ago period.

 

Net loss for H1 FY2023 was mainly due to slower property sales for the development segment and the S$23.3 million loss on disposal of investment in associates, the company said in its financial statement filed to the bourse on Wednesday (Sep 14).

 

Revenue declined 44 per cent to S$49.8 million from S$88.9 million.

 

Low Keng Huat has 3 main segments: development, hotel and investment. Notably, all 3 segments were in the red, although its hotel business managed to reduce loss, compared to the corresponding period a year earlier.

 

Development revenue dropped by about two-thirds to S$19.5 million from S$67.2 million. Only 7 units out of 138 in Klimt Cairnhill were sold as at end-July despite the residential project being launched in August 2021. Klimt Cairnhill is a 36-storey, high-end freehold condominium development located in the Orchard vicinity.

 

The segment registered a loss of S$372,000 before tax and non-controlling interest.

 

However, the hotel segment and investment segment both reported higher turnover.

 

Revenue from the hotel segment increased to S$16.5 million from S$9.9 million as occupancy rates and average room rates at Duxton Hotel Perth and Citadines Balestier improved. Lyf @ Farrer also commenced operations in February 2022, contributing to revenue as its occupancy averaged 80 per cent.

 

Net loss before tax and non-controlling interests for the hotel segment decreased by S$1.1 million to S$1.6 million.

 

Revenue from the investment segment rose to S$13.8 million from S$11.9 million, mainly driven by construction revenue from the Dalvey Haus project, a residential development project 40 per cent owned by the group. The construction of Dalvey Haus project was 52 per cent completed as at end-July.

 

Net loss before tax and non-controlling interests for the Investment segment was S$20.7 million, compared to a profit of S$28.9 million a year earlier, due to a loss on disposal of investment in associates.

 

Net tangible assets per share for the group as at end-July amounted to S$0.86, slightly lower than S$0.91 as at end-January.

 

No dividend was declared as it is &ldquo not the usual practice of the group to declare interim dividend&rdquo .

 

Low Keng Huat said the group will focus on the completion and sales of existing residential development projects. The easing of cross-border travel restrictions and the resumption of global travel should result in improved room rates and occupancies for its hospitality assets.

 

Suburban retail mall rents and occupancies are expected to be stable, supported by a recovery in consumption, a return of office workers that lead to larger lunch crowds, and its focus on non-discretionary shopping, it noted.

 

Mainbaord-listed builder Low Keng Huat recorded a 52% drop in its latest 1HFY2021 ended July earnings to $25.1 million, compared to $51.9 million in 1HFY2020. 

 

This was mainly due to a loss from its associated companies and joint ventures ad an increase in taxation. 

 

Revenue for the first half period increased significatly to $88.9 million, compared to $22.9 million last year. 

 

Increase of revenue was mainly from the group' s development segment of $57.3 million. Development revenue increase was solely due to sales at Uptown @ Farrer. As at July 31, 93 out of 116 units were sold at average price of $1,863 psf.

 

Hotel and Investment segments increased their revenue by $3.3 million and $5.5 million respectively in 1HFY2021 compared to 1HFY2020. The increase in revenue in Investment segment was mainly due to increased construction revenue at Dalvey Haus and absence of rental relief granted to tenants at Paya Lebar Square retail mall.

 

Construction completion at Dalvey Haus was 22% at 1HFY2021 and 1% at 1HFY2020. The rental relief was granted due to lockdowns and safe distancing measures imposed by the Singapore government to curb the spread of Covid-19 pandemic in the same period last year. The increase in revenue in Hotel segment was mainly due to the increase in occupancy rates and average room rates at both Duxton Perth and Citadines Balestier. 

 

Other income also saw a significant increase to $29.6 million from $2.2 million a year ago, mainly due to gain on disposal of investment properties, comprising office units at Paya Lebar Square of $8.6 million and gain on disposal of investment in joint ventures in Westgate group of companies of $19.7 million.  

 

The group recorded a loss from share of results of associated companies and joint ventures of $281,000 compared to share of profit of $53.8 million last year. The decrease was mainly due to the gain on sale of equity stake in Perennial Shenton Holdings of $50.0 million last year. 

PROPERTY player Low Keng Huat has entered agreements to sell its interests in Westgate Tower for S$97.1 million, while buying the remaining 45 per cent of Paya Lebar Square that it does not already own for S$90.5 million.

 

Low Keng Huat hopes to focus on retail instead of commercial office developments, as it has more experience in managing the former, the mainboard-listed company said in a Friday bourse filing after trading hours.

 

" Accordingly, the proposed transactions are suitable opportunities for the company to streamline its property investment business by divesting its commercial office developments and expanding and focusing on retail developments instead," it said. The purchase and sale prices are subject to adjustments.

 

The buyer of the Westgate Tower stake and seller of the Paya Lebar Square shares are Sun Venture Homes (SVH) and Sun Venture Realty (SVR) respectively. They are joint venture partners of Low Keng Huat in both properties.

 

Low Keng Huat' s interests in Westgate Tower to be sold comprise a 40 per cent stake in each of Westgate Tower Pte Ltd (WTPL) and Westgate Commercial Pte Ltd (WCPL). Both entities collectively own 295 office units in Westgate Tower, a commercial office development at 1 Gateway Drive.

 

The sale price for the Westgate Tower interests represents an excess of S$14.33 million over the net book value of the relevant sale shares. It also includes shareholders' loans of an aggregate amount of S$80.5 million owing to Low Keng Huat.

 

For the financial year ended January, the net loss attributable to WTPL and WCPL were S$2.6 million and S$3.2 million respectively. Low Keng Huat said that there is a S$8.11 million gain on disposal with WTPL and a S$6.23 million gain on disposal with WCPL.

 

In the other transaction, Low Keng Huat will acquire shares of Paya Lebar Square Pte Ltd (PLSPL), which owns the Paya Lebar Square commercial office and retail development at 60 Paya Lebar Road, with 159 retail units and one office unit. Low Keng Huat already owns 55 per cent of PLSPL.

 

For the financial year ended January, the net loss attributable to PLSPL was S$1.4 million. Its book value and net tangible asset value stood at S$39.8 million as at end-January.

 

The S$90.5 million purchase price for the PLSPL stake includes a shareholder' s loan of S$47.6 million owing to SVR.

 

Low Keng Huat said that the proposed transactions are in line with its capital recycling strategy to deliver a divestment gain and reallocate resources to new properties such as Paya Lebar Square. Its other property investments include BT Centre at 207 Balestier Road and the retail podium of lyf@Farrer at 2 Perumal Road.

 

In line with its shift away from office properties, the company had also entered into options to purchase on April 20 with unrelated third parties to dispose of four office units at Paya Lebar Square. The completion for these disposals is scheduled to take place on or about June 29.

 

On May 3, Low Keng Huat (Singapore) executive director Alvin Teo Poh Kheng acquired 496,800 shares of the company for a consideration of S$245,916, at 49.5 cents per share.

 

This took his deemed interest in the property development, hotel and investment business and from 0.47 per cent to 0.54 per cent.

 

Recently appointed to the board of Low Keng Huat (Singapore) on April 5, Mr Teo is responsible for the group' s property business in Singapore.

 

On April 16, Low Keng Huat (Singapore) executive director Alvin Teo Poh Kheng acquired 201,200 shares of the company for a consideration of S$98,588, at 49.0 cents per share.

 

This took his deemed interest in the property development, hotel and investment business and from 0.45 per cent to 0.47 per cent. This followed his acquisition of 790,000 shares at 46.7 cents per share between April 8 and 13.

 

Recently appointed to the board of Low Keng Huat (Singapore) on April 5, Mr Teo is responsible for the group' s property business in Singapore.

 

Between April 8 and 13, Low Keng Huat (Singapore) executive director Alvin Teo Poh Kheng acquired 790,000 shares of the company for a total consideration of S$368,573, at an average price of 46.7 cents per share.

 

This took his deemed interest in the property development, hotel and investment business from 0.34 per cent to 0.45 per cent.

 

Recently appointed to the board of Low Keng Huat (Singapore) on April 5, Mr Teo is responsible for the group' s property business in Singapore.

 

On April 1, the company reported that its FY21 (ended Jan 31) net profit attributable to shareholders increased to S$48.7 million, from S$12.8 million in FY20.

 

The increase was mostly attributed to higher profit in the investment segment due to a gain on the sale of the 50 per cent of equity interest in AXA Tower offset by lower profits in the hotel and development segments.

 

The net profit attributable to shareholders would have been a negative S$1.5 million if it excludes the gain on the sale of the 50 per cent equity stake in AXA Tower.

MAINBOARD-LISTED builder Low Keng Huat (Singapore) posted a net loss attributable to shareholders of S$3.14 million for the second half of the financial year ended Jan 31, 2021, down from a net profit of S$11.96 million in the year-ago period.

 

This was despite revenue rising 71 per cent to S$50.49 million, from S$29.46 million in the year-ago period. The increase was mainly from the development segment, with sales at the Uptown @ Farrer development, launched in the third quarter. As at Jan 31, 2021, 48 out of 116 units had been sold at an average price of S$1,873 per square foot.

 

But cost of sales rose at a faster pace, more than doubling to S$44.3 million. Other income also fell by S$11.2 million, to S$5.2 million in the second half, mainly due to the absence of a S$14.9 million write-back of provision of impairment in the previous year.

 

Loss per share was 0.43 Singapore cents for the half-year, down from 1.62 Singapore cents in the year-ago period.

 

A first and final dividend of 2.5 Singapore cents per share has been declared, up from 1.5 Singapore cents the year before.

 

For the full year, the firm recorded a net profit attributable to shareholders of S$48.7 million, up from S$12.8 million the year before.

 

But this was due mainly to a higher profit in its investment segment, with a gain on the sale of its 50 per cent stake in AXA Tower. Excluding this gain, Low Keng Huat would have recorded a net loss of S$1.5 million instead.

Construction company Low Keng Huat reported earnings of $51.9 million in 1H20 ended July, from $0.8 million a year ago.

The significant increase was mainly due to the gain on sale on Low Keng Huat&rsquo s equity stake in Perennial Shenton Holdings (PSH) of $50 million during the period.

 

Excluding the sale, the company&rsquo s earnings would have increased by $1.1 million to $1.9 million in 1H20.

 

Earnings per share (EPS) for 1H20 stood at 7.02 cents from the 0.11 cents the year before.

 

Revenue grew by 33% y-o-y to $22.9 million. The growth was attributable to the increase in revenue of $9.9 million in the development segment due to sales at Uptown @ Farrer, which was launched for sale in 3Q19.

 

The growth in revenue was offset by the $2.1 million decrease each in the investment and hotel segments. The decrease in both segments were attributable to the rental rebates granted to tenants at the retail mall in Paya Lebar Square, and the decrease in occupancy at Duxton Perth Hotel respectively.

 

The decrease in the hotel segment was slightly offset by the increase in occupancy at Citadines Balestier.

 

Cost of sales increased 58% y-o-y to $16.6 million due to higher sales in the development segment.

 

Share of results of associated companies and joint ventures registered profit of $53.9 million mainly due to the sale of equity stake in PSH, compared to the $2.0 million loss in FY19.

 

As at July 31, cash and cash equivalents stood at $130.6 million.