CDL marks 60th anniversary in style with record earnings of $1.3 bil

By The Edge Singapore

/ EdgeProp Singapore |

February 23, 2023 6:53 PM SGT

Artist's impression of the clubhouse at Tembusu Grand, a 638-unit residential development in District 15. CDL and joint venture partner MCL Land will be launching the project in 1H2023 (Picture: CDL)

SINGAPORE (EDGEPROP) - City Developments Limited (CDL) has reported earnings of $165.8 million for 2HFY2022, up 42% y-o-y, on the back of a 27% improvement in revenue to $1.82 billion.

For the full year, the property and hospitality company posted all-time-high earnings of $1.29 billion, thanks to an operational recovery from the pandemic and a slew of divestment gains. For FY2021, it recorded earnings of $84.7 million.

The group reported FY2022 revenue of $3.29 billion, up 25.4% y-o-y. Property development remained the biggest contributor, accounting for 42% ($1.38 billion) of revenue for the year. Three key Singapore projects helped: Amber Park, Haus on Handy and Irwell Hill Residences.

Irwell Hill Residences scale model - EDGEPROP SINGAPORE

Irwell Hill Residences, a 99-year leasehold development on Irwell Bank Road, has seen 94% of its 540 units sold to date (Picture: Samuel Isaac Chua/The Edge Singapore)

CDL’s hotel operations, hurt like everyone else during the pandemic, rebounded strongly. Revenue for FY2022 was up 58% to $1.38 billion, supported by a 91% increase in hotel RevPAR (revenue per average room) to $137.90. The RevPAR growth was attributable to a 48.9% increase in average room rates and a 14.2 percentage point improvement in occupancy.

CDL’s executive chairman Kwek Leng Beng calls the FY2022 results a “sterling” one, driven by prudent divestments and strong operational performance from its core business segments. “Notably, our hotel operations made an outstanding rebound, having recovered in most markets to pre-pandemic levels,” he says.

He adds: “Riding on the return of corporate travel and unabated pent-up demand for leisure travel, our hospitality segment will continue to strengthen and is poised to be a star performer for the year ahead.” He notes that a key focus for CDL’s hospitality portfolio will be to accelerate plans for asset optimisation.

CDL group CEO Sherman Kwek says the group has embraced capital recycling and unlocked latent value via well-timed divestments and various asset enhancement initiatives. “All the while, we have been managing our capital prudently, reducing our gearing and strengthening our cash. While market uncertainties persist, CDL will continue to display discipline, agility, resilience and innovation so as to deliver sustainable growth and maximise long-term shareholder value,” he adds.

Significant divestment gains made by CDL over the past year include the sale of Millennium Hilton Seoul, the gain on the deconsolidation of CDL Hospitality Trusts (CDLHT), and the completion of the collective sales of Tanglin Shopping Centre and Golden Mile Complex where CDL owns share values and strata areas. According to CDL, the assets were held at book value over a long period of time, resulting in significant capital gains.

In terms of residential sales, CDL sold a total of 1,487 homes including executive condominiums (ECs) in Singapore in FY2022, representing a total sales value of $2.9 billion. In comparison, the group sold 2,185 residential units worth $4.3 billion in FY2021.

FY2022 sales were underpinned by the launch of two projects – Piccadilly Grand and Copen Grand – which are both joint venture projects with MCL Land. The 407-unit Piccadilly Grand, located in Farrer Park, launched in April 2022 with 86% of its units sold to date. Copen Grand, an EC located in Tengah Town, launched last October and was fully sold out one month after its launch.

Copen Grand is the first EC to be launched in the upcoming Tengah Town, Singapore’s first smart and sustainable precinct (Picture: CDL)

The group has three residential launches in the pipeline for 2023. In 1H2023, CDL will launch Tembusu Grand, a 638-unit development along Tanjong Katong Road and Jalan Tembusu in District 15. It is a joint-venture project with MCL Land.

Another launch slated in 1H2023 is Newport Residences, a 45-storey freehold development comprising 246 units. Newport Residences is part of Newport Plaza, an integrated mixed-use development with apartments, serviced residences, offices and retail units. It is a redevelopment of the former Fuji Xerox Towers on Anson Road in Tanjong Pagar.

In the second half of the year, CDL will launch The Myst, a 99-year leasehold condominium along Upper Bukit Timah Road. The project comprises two 24-storey blocks with 408 apartments.

Artist's impression of Newport Residences, which is slated to launch in 1H2023 (Picture: CDL)

CDL, which turns 60 this year, plans to mark its diamond jubilee in style by paying a final dividend of 8 cents per share, plus a special dividend of another 8 cents. With an interim special dividend of 12 cents already paid in September 2022, this brings total cash dividend for FY2022 to 28 cents. In contrast, CDL paid a cash dividend of 12 cents for FY2021 and 20.2 cents worth from the distribution in specie of CDLHT units.

As at Dec 31, 2022, CDL’s net asset value (NAV) was $10.16, up 9.7%. The company maintains its conservative stance of stating its investment and hotel properties at cost less accumulated depreciation and impairment losses. If fair value gains are factored in, CDL’s revalued NAV would be $16.98 as at Dec 31 2022, versus $15.73 as at Dec 31 2021. Had the revaluation surpluses of its hotels been included, the RNAV (realisable net asset value) per share would be $19.14.

“Over the past 60 years, the group has weathered many economic storms, property cycles and unprecedented disruptions, but we have always tackled the odds head-on and successfully emerged stronger," says chairman Kwek. "We will continue to apply this same discipline and tenacity to bring CDL to greater heights."

Check out the latest listings near Tembusu Grand, Newport Residences, Tanglin Shopping Centre, Golden Mile Complex, Piccadilly Grand, Copen Grand, The Myst

Tags:

Follow our channels to receive property news updates 24/7 round the clock.

Subscribe to our newsletter