CapitaLand

Kim Eng on 20 Feb 2014

What’s New
CapitaLand reported headline 4Q13 PATMI of SGD142.9m (-45.6% YoY, +5.5% QoQ). Other than a SGD120.8m forex loss incurred as it reduced its stake in Australand, the group also made impairments amounting to SGD164.8m, mainly for specific projects in China, India, Australia and the GCC. A loss of SGD31m was also incurred as some convertible bonds were repurchased.
Key takeaways from results briefing

Management stressed that the impairments and charges were
mostly one-off and would put the group in a better position going forward. For example, the convertible bonds were refinanced at lower rates.

We note that no impairments were made for any of its Singapore residential projects. Management deemed it unnecessary for now, although it conceded that the market could soften this year. It added that its Singapore residential portfolio remains manageable at just under 10% of the group’s total assets. It is still looking to launch the 124-unit Marine Blue at Marine Parade and release more
units at Sky Habitat in Bishan this year.

Management remains sanguine on China, as it targets to grow contracted residential sales by 30% in FY14 (from CNY8.5b in FY13). It is still on the lookout for new opportunities, be they residential, retail or mixed-developments.