Singapore, 10 August 2023 - For the half-year ended 30 June 2023 (1H 2023), City Developments Limited (CDL) achieved strong revenue growth of 83.6% to S$2.7 billion (1H 2022: S$1.5 billion), primarily driven by the property development segment.

Despite the higher revenue, the Group achieved lower net profit after tax and non-controlling interest (PATMI) of S$66.5 million (restated 1H 2022: S$1.1 billion1), largely due to the absence of substantial divestment gains recorded in 1H 2022. These included the gains from the record sale of Millennium Hilton Seoul and its adjoining land site and the gain on the deconsolidation of CDL Hospitality Trusts (CDLHT) from the Group following the distribution in specie of CDLHT units in 1H 2022. Furthermore, the higher financing costs and the impairment losses for its UK investment properties further impacted 1H 2023 PATMI.

Financial Highlights

The property development segment continued to be the biggest contributor as its revenue jumped 183.2%. The significant increase was underpinned by the contribution from its fully sold Piermont Grand Executive Condominium (EC) which obtained its Temporary Occupation Permit (TOP) in 1H 2023, enabling its revenue and profit to be recognised in entirety upon completion under prevailing accounting policies for ECs.

The hotel operations segment also saw a 12.4% increase in revenue for 1H 2023 with revenue per available room (RevPAR) growth across all regions, supported by the continued strong momentum in international travel. Singapore reported a RevPAR growth of 51% and correspondingly, the Asia region contributed the most with an 88.3% increase in RevPAR. Notably, the performance of Asia, Europe and US regions had exceeded the RevPAR of pre-COVID 2019 levels.

The Group registered a pre-tax profit of S$179.5 million for 1H 2023 vis-à-vis S$1.6 billion for 1H 2022, whereby 1H 2022 was boosted by substantial divestment gains as mentioned above. Excluding divestment gains and impairment losses, the Group would have registered a 48.1% increase in pre-tax profit for 1H 2023 on a like-for-like basis.

The property development segment was the lead contributor following the recognition of the profits for the fully sold Piermont Grand EC as well as other strong-performing Singapore projects such as Amber Park, Boulevard 88 and Irwell Hill Residences.

Excluding divestment gains and impairment losses, EBITDA for 1H 2023 increased by 47.7% versus 1H 2022. Despite a pre-tax loss of S$6.8 million, the hotel operations segment still generated S$100.0 million in EBITDA for 1H 2023 resulting from a 42.7% improvement in RevPAR across all regions.

As of 30 June 2023, the Group maintained its robust capital position with cash reserves of S$2.1 billion, and cash and available undrawn committed bank facilities totalling S$3.4 billion.

After factoring in fair value on investment properties, the Group's net gearing ratio stands at 57% (FY 2022: 51%), following the acquisition of St Katharine Docks located in Central London for £395 million (approximately S$636 million) in March 2023. Average borrowing costs stand at 4.1% for 1H 2023 compared with 2.4% for FY 2022, reflecting the interest rate hikes in the key markets where the Group operates.

The Board is pleased to declare payment of a tax-exempt (one-tier) special interim dividend of 4.0 cents per ordinary share.

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CDL - City Developments Ltd. published this content on 10 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 August 2023 23:28:03 UTC.