MCL Land Limited Half Yearly

RNS Number : 9667W

Hongkong Land Hldgs Ld

05 August 2009

 



To:	Business Editor	6th August 2009
		For immediate release

MCL Land Limited

First Half 2009 Financial Statements and Dividend Announcement

The following announcement was issued today by the Company's 77%-owned subsidiary, MCL Land Limited.

For further information, please contact:

Hongkong Land Limited
G M Brown	(852) 2842 8138
GolinHarris
Sue So	(852) 2501 7984

6th August 2009

MCL LAND LIMITED

FIRST HALF 2009 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

Highlights

•	Completions of The Fernhill and Tierra Vue
•	Profit attributable to shareholders US$38.1 million

'The two completions in the first half of the year, together with the completion of Hillcrest Villa in the second half, will produce an overall satisfactory performance for the full year. These projects are also generating good cash flows that will enhance further the Group's strong financial position.'

Y K Pang, Chairman

6th August 2009

Group Results

				Six months ended 30th June
				2009	2008	Change	2009	Change
				US$m	US$m	%	S$m	%
Revenue				144.1	0.7	n/m	209.5	n/m
Profit before tax				44.4	8.2	438	64.4	470
Profit attributable to shareholders				38.1	8.2	365	55.4	390
				US¢	US¢		S¢
Earnings per share				10.29	2.22	364	14.96	392
				At 30.6.2009	At  31.12.2008	Change	At 30.6.2009	Change
				US$m	US$m	%	S$m	%
Shareholders' funds				403.8	393.9	3	585.1	3
				US$	US$		S$
Net asset value per share				1.09	1.06	3	1.58	3

n/m = not meaningful

The exchange rate of US$1=S$1.45 (31.12.2008: US$1=S$1.44) was used for translating assets and liabilities at the balance sheet date and average monthly transaction rates of US$1=S$1.49 (2008: US$1=S$1.38) was used for translating the results for the financial period.

The financial results for the six months ended 30th June 2009 and 30th June 2008 have been prepared based on the International Financial Reporting Standards ('IFRS'). The financial results for 30th June 2009 have not been audited or reviewed by the Auditors.

  Overview

There has been increased activity in the residential property market in Singapore recently. This has been principally in the mass and middle markets, although there have also been signs of a revival in the high-end condominium sector. While this is encouraging, it is too early to conclude that a sustainable economic recovery is underway. 

Group Performance

MCL Land recorded revenue of US$144.1 million in the first half of 2009, mainly from the recognition of sales proceeds from The Fernhill and Tierra Vue, compared with US$0.7 million in the first half of 2008. Net profit for the first half of 2009 was US$38.1 million, compared with US$8.2 million in the first half of 2008.

Shareholders' funds were US$404 million at the end of June 2009, up marginally from US$394 million at 31st December 2008 following the payment of a one-tier first and final dividend for 2008 of US$25 million in May 2009. The Group's net debt and net gearing at 30th June 2009 were US$97 million and 24% respectively, compared with US$181 million and 46% at the end of 2008.

The Board is not recommending the payment of an interim dividend for the first half of 2009 (2008: nil).

Properties

No new development projects were launched by the Group in Singapore during the period under review. D'Pavilion, a 50-unit apartment development at Upper Serangoon Road, had 28% of the units pre-sold at 30th June 2009, while The Peak@Balmeg, a 180-unit condominium development, had 29% of its units pre-sold.  Waterfall Gardens and all but two units at Hillcrest Villa are fully pre-sold.

The Fernhill obtained its Temporary Occupation Permit in March 2009 and net profit of S$2.4 million for five apartments was recognised in the first quarter, while the balance of the net profit of US$9.9 million was recognised in May 2009 upon collection of outstanding sales proceeds from the buyers of 20 apartments.  Tierra Vue obtained its Temporary Occupation Permit and contributed a net profit of US$26.3 million in June 2009.

Construction of the Group's various projects continues to progress well. Hillcrest Villa is expected to complete in the second half of 2009.  Waterfall Gardens and D'Pavilion are scheduled to complete in 2010, followed by The Peak@Balmeg in 2011. In addition, the Group has seven development projects in Singapore with a total gross floor area of about 158,000 square metres that are at various stages of planning approval.

The Group's joint venture developments in Malaysia continued to perform satisfactorily. Phase 1 of Riana Green had 96% of its units pre-sold at 30th June 2009. Sales of Seremban Forest Heights, the joint venture development in Seremban, continued with 153 of the 270 terrace houses, bungalows, bungalow lots and shop offices now pre-sold.

Wangsa Walk, a retail mall development in Kuala Lumpur by the Group's joint venture company, MSL Properties, is expected to complete in the second half of 2009. Wangsa Walk has net lettable area of 25,000 square metres, of which some 90% has been pre-leased.

Prospects

The two completions in the first half of the year, together with the completion of Hillcrest Villa in the second half, will produce an overall satisfactory performance for the full year. These projects are also generating good cash flows that will enhance further the Group's strong financial position.

Y K Pang

Chairman

6th August 2009

Statement pursuant to Rule 705(5) of the Listing Manual

The directors confirm that, to the best of their knowledge, nothing has come to the attention of the Board of Directors which may render the accompanying unaudited interim financial results for the six months ended 30th June 2009 to be false or misleading in any material respect.

On behalf of the Directors

Y K Pang

Chairman

Hassan Abas

Director

6th August 2009

MCL Land Limited
Consolidated Profit and Loss Account
			Three months ended					Six months ended
			30.6.2009		30.6.2008	Change		30.6.2009		30.6.2008	Change
		Note	US$'000		US$'000	%		US$'000		US$'000	%
Revenue			135,799		353		n/m	144,103		718		n/m
Cost of sales			(92,283)		-		n/m	(97,445)		-		n/m
Gross profit			43,516		353		n/m	46,658		718		n/m
Other operating income			384		3,108	-	88	715		3,618	-	80
Property related expenses			(196)		(352)	-	44	(342)		(529)	-	35
Administrative expenses			(1,154)		(1,116)		3	(2,103)		(1,631)		29
Share of joint ventures’ results			(167)		1,131		n/m	(576)		6,072		n/m
Profit before tax		2	42,383		3,124		n/m	44,352		8,248		438
Tax		3	(5,689)		60		n/m	(6,270)		(50)		n/m
Profit after tax attributable to
shareholders			36,694		3,184		n/m	38,082		8,198		365
			US¢		US¢		%	US¢		US¢		%
Earnings per share ('EPS')
attributable to shareholders
	- basic and diluted*	4	9.92		0.86		n/m	10.29		2.22		364
n/m = not meaningful
*	Diluted EPS is the same as basic EPS, as there were no outstanding share options.

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th June
Consolidated Statement of Comprehensive Income for the three months ended 30th June
			2009		2008
			US$'000		US$'000
Profit after tax			36,694		3,184
Translation difference			18,196		6,614
Total comprehensive income attributable to shareholders			54,890		9,798
Consolidated Statement of Changes in Equity for the three months ended 30th June
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st April		276,657	88,409	9,297	374,363
Comprehensive income for the financial period		-	18,196	36,694	54,890
Dividend		-	-	(25,493)	(25,493)
Balance at 30th June		276,657	106,605	20,498	403,760
2008
Balance at 1st April		276,657	129,364	147,302	553,323
Comprehensive income for the financial period		-	6,614	3,184	9,798
Dividend		-	-	(27,091)	(27,091)
Balance at 30th June		276,657	135,978	123,395	536,030

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the six months ended 30th June
Consolidated Statement of Comprehensive Income for the six months ended 30th June
			2009		2008
			US$'000		US$'000
Profit after tax			38,082		8,198
Translation difference			(2,778)		30,750
Total comprehensive income attributable to shareholders			35,304		38,948
Consolidated Statement of Changes in Equity for the six months ended 30th June
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st January		276,657	109,383	7,909	393,949
Comprehensive (loss)/income for the financial period		-	(2,778)	38,082	35,304
Dividend		-	-	(25,493)	(25,493)
Balance at 30th June		276,657	106,605	20,498	403,760
2008
Balance at 1st January		276,657	105,228	142,288	524,173
Comprehensive income for the financial period		-	30,750	8,198	38,948
Dividend		-	-	(27,091)	(27,091)
Balance at 30th June		276,657	135,978	123,395	536,030

MCL Land Limited
Consolidated Balance Sheet
				At		At
				30.6.2009		31.12.2008
		Note		US$'000		US$'000
Non-current assets 1
Plant and equipment				142		212
Investment properties				15,785		15,985
Investments in joint ventures				32,788		34,739
Deferred tax assets				765		874
				49,480		51,810
Current assets 2
Development properties for sale				634,621		683,534
Amounts owing by joint ventures				62,862		62,018
Debtors and prepayments				54,931		80,797
Bank balances				173,200		131,800
				925,614		958,149
Total assets				975,094		1,009,959
Non-current liabilities 3
Borrowings		5		253,073		298,242
Deferred tax liabilities				458		459
Creditors				701		-
Retention money payable				6,636		7,137
				260,868		305,838
Current liabilities 4
Borrowings		5		17,251		14,871
Amounts owing to joint venture				455		459
Creditors				277,489		277,437
Current tax liabilities				15,271		17,405
				310,466		310,172
Total liabilities				571,334		616,010
Net assets				403,760		393,949
Equity:
Share capital and reserves
Share capital				276,657		276,657
Translation reserve				106,605		109,383
Retained earnings				20,498		7,909
Shareholders' funds				403,760		393,949
Net asset value per share				US$1.09		US$1.06

Explanatory notes on material variances:
1	The decrease in non-current assets at 30.6.2009 as compared to 31.12.2008 is mainly due to the loss incurred from the Group's joint ventures and translation loss.
2	The decrease in current assets is mainly due to lower development properties for sale from the completion of The Fernhill and Tierra Vue in March and June 2009 respectively. This is partially offset by higher bank balances arising from progress billings collected from the Group's development properties.
3	The lower non-current liabilities at 30.6.2009 as compared to 31.12.2008 is mainly due to repayment of longterm bank loans during the financial period from progress billings collected from the Group's development properties.
4	The higher current liabilities at 30.6.2009 as compared to 31.12.2008 is mainly due to the increase in short-term bank loans during the financial period partially offset by payment of income tax.

MCL Land Limited
Company Balance Sheet
		At		At
		30.6.2009		31.12.2008
		US$'000		US$'000
Non-current assets
Plant and equipment		120		182
Interests in subsidiaries		57,804		58,909
Investments in joint ventures		27,578		27,773
		85,502		86,864
Current assets
Amounts owing by subsidiaries		236,672		353,289
Amounts owing by joint ventures		62,862		62,018
Debtors and prepayments		281		280
Bank balances		120,342		70,916
		420,157		486,503
Total assets		505,659		573,367
Non-current liability
Borrowings		44,852		45,170
Current liabilities
Borrowings		17,251		9,034
Amounts owing to subsidiaries		68,953		35,564
Amounts owing to joint venture		455		459
Creditors		2,611		3,336
Current tax liabilities		135		2,284
		89,405		50,677
Total liabilities		134,257		95,847
Net assets		371,402		477,520
Equity:
Share capital and reserves
Share capital		276,657		276,657
Translation reserve		90,169		96,048
Retained earnings		4,576		104,815
Shareholders' funds		371,402		477,520
Net asset value per share		US$1.00		US$1.29

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th June
Company Statement of Comprehensive Income for the three months ended 30th June
		2009		2008
		US$'000		US$'000
(Loss)/Profit after tax		(23,541)		3,231
Translation difference		19,630		6,143
Total comprehensive (loss)/income attributable to shareholders		(3,911)		9,374
Company Statement of Changes in Equity for the three months ended 30th June
	Attributable to shareholders
	Share	Translation	Retained	Total
	capital	Reserve	Earnings	equity
	US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st April	276,657	70,539	53,610	400,806
Comprehensive income/(loss) for the financial period	-	19,630	(23,541)	(3,911)
Dividend	-	-	(25,493)	(25,493)
Balance at 30th June	276,657	90,169	4,576	371,402
2008
Balance at 1st April	276,657	114,402	84,610	475,669
Comprehensive income for the financial period	-	6,143	3,231	9,374
Dividend	-	-	(27,091)	(27,091)
Balance at 30th June	276,657	120,545	60,750	457,952

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the six months ended 30th June
Company Statement of Comprehensive Income for the six months ended 30th June
		2009		2008
		US$'000		US$'000
(Loss)/Profit after tax		(74,746)		2,887
Translation difference		(5,879)		27,184
Total comprehensive (loss)/income attributable to shareholders		(80,625)		30,071
Company Statement of Changes in Equity for the six months ended 30th June
	Attributable to shareholders
	Share	Translation	Retained	Total
	capital	Reserve	Earnings	Equity
	US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st January	276,657	96,048	104,815	477,520
Comprehensive loss for the financial period	-	(5,879)	(74,746)	(80,625)
Dividend	-	-	(25,493)	(25,493)
Balance at 30th June	276,657	90,169	4,576	371,402
2008
Balance at 1st January	276,657	93,361	84,954	454,972
Comprehensive income for the financial period	-	27,184	2,887	30,071
Dividend	-	-	(27,091)	(27,091)
Balance at 30th June	276,657	120,545	60,750	457,952

MCL Land Limited
Consolidated Statement of Cash Flows
			Three months ended				Six months ended
			30.6.2009		30.6.2008		30.6.2009		30.6.2008
			US$'000		US$'000		US$'000		US$'000
Profit before tax			42,383		3,124		44,352		8,248
Non-cash items
	Interest income		(243)		(387)		(545)		(810)
	Financing charges
	Share of joint ventures' results		167		(1,131)		576		(6,072)
	Depreciation		35		43		72		86
	Loss on disposal of plant and equipment		1		-		1		-
	Unrealised translation gain		(2)		(10)		(2)		(9)
			(42)		(1,485)		102		(6,805)
Operating profit before working capital changes			42,341		1,639		44,454		1,443
Changes in working capital
	Development properties for sale		64,241		(191,864)		48,031		(277,828)
	Amounts owing by joint ventures		929		39,364		(112)		39,696
	Debtors and prepayments		13,426		30,253		24,703		144,213
	Creditors		(14,468)		26,732		1,103		44,880
			64,128		(95,515)		73,725		(49,039)
Cash flows generated from/(used in) operations			106,469		(93,876)		118,179		(47,596)
	Interest paid		(1,516)		(2,327)		(2,804)		(4,433)
	Interest received		263		374		557		846
	Income tax paid		(7,525)		(6,759)		(8,134)		(6,799)
			(8,778)		(8,712)		(10,381)		(10,386)
	Net cash flows generated from/(used in) operating activities 5		97,691		(102,588)		107,798		(57,982)
Cash flows from investing activities
	Purchase of plant and equipment		(4)		-		(6)		(10)
	Net cash flows used in investing activities		(4)		-		(6)		(10)
Cash flows from financing activities
	Drawdown of loans		51,357		148,605		51,654		206,868
	Repayment of loans		(56,483)		(46,136)		(90,339)		(140,479)
	Dividend paid		(25,493)		(27,091)		(25,493)		(27,091)
	Net cash flows (used in)/provided by financing activities 6		(30,619)		75,378		(64,178)		39,298
Net change in cash and cash equivalents			67,068		(27,210)		43,614		(18,694)
Cash and cash equivalents at the beginning of the
	financial period		101,349		91,280		131,800		78,419
Effect of exchange rate changes			4,783		1,048		(2,214)		5,393
Cash and cash equivalents at the end of the financial period			173,200		65,118		173,200		65,118
Explanatory notes on material variances:
5	The net generated from operating activities for the six months ended 30th June 2009 relates mainly to progress billings collected from the Group's development properties.
6	The net cash flows used in financing activities for the six months ended 30th June 2009 relates mainly to long-term bank loans repaid from the progress billings collected from the Group's development properties and dividend paid on 26th May 2009.

MCL Land Limited
Notes
1		Accounting policies and basis of preparation
		The financial statements contained in this announcement are prepared in accordance with the accounting policies and methods of computation set out in the 2008 audited accounts, which are based on International Financial Reporting Standards ('IFRS'). There have been no changes to the accounting policies set out in the 2008 audited accounts except for the adoption of the new standards, amendments and interpretations to the existing standards which are relevant to its operations shown below:
		IAS 1 (Revised 2007)	Presentation of Financial Statements
		IAS 23 (Revised 2007)	Borrowing Costs
		Amendments to IFRS 1 and	Cost of an investment in Subsidiary, Jointly Controlled Entity or
			Associate
		Amendment to IFRS 2	Share-based Payment
		Amendment to IFRS 7	Improving Disclosures about Financial Instruments
		IFRS 8	Operating Segments
		IFRIC 15	Agreements for Construction of Real Estate
		IFRIC 16	Hedges of a Net Investment in a Foreign Operation
		Improvements to IFRS (2008)	Amendments to IAS 1, 16, 19, 23, 27, 28, 36, 38, 39 and 40
		The adoption of the above standards, amendments and interpretations did not have a material impact on the results of the Group.

2	Profit
		Group
		Three months ended						Six months ended
		30.6.2009		30.6.2008		Change		30.6.2009		30.6.2008		Change
		US$'000		US$'000		%		US$'000		US$'000		%
	Profit before tax is determined after including:
	Net exchange (loss)/gain	(1)		(2)	-	50		-		12	-	100
	Rental income	278		353	-	21		545		718	-	24
	Interest income	243		387	-	37		545		810	-	33
	Depreciation on plant and equipment	(35)		(43)	-	19		(72)		(86)	-	16
	Loss on disposal of plant and equipment			-		n/m		(1)		-		n/m
		(1)
	n/m = not meaningful

3	Tax
	The provision for income tax is based on the statutory tax rates prevailing in the respective countries in which Group companies operate after taking into account expenses which are not tax deductible, income not subject to tax and Group tax relief.

4	Earnings per share*
			Group
			Three months ended				Six months ended
			30.6.2009		30.6.2008		30.6.2009		30.6.2008
	Basic earnings per share*
	Profit attributable to shareholders (US$'000)		36,694		3,184		38,082		8,198
	Weighted average number of ordinary shares
		in issue ('000)	369,986		369,986		369,986		369,986
	Basic earnings per share (US¢)		9.92		0.86		10.29		2.22
	* Diluted EPS is the same as basic EPS, as there were no outstanding share options.

5	Group borrowings
							Group
							At		At
							30.6.2009		31.12.2008
							US$'000		US$'000
	Borrowings due within one year
		- unsecured					17,251		9,034
		- secured					-		5,837
							17,251		14,871
	Borrowings due after one year
		- unsecured					44,852		45,170
		- secured					208,221		253,072
							253,073		298,242
							270,324		313,113
	Certain subsidiaries of the Company have mortgaged their development properties as security for bank loans. The net book value of properties mortgaged as at 30th June 2009 was US$350.6 million (31st December 2008: US$296.6 million).

6	Interested person transactions
				Aggregate value of all interested person transactions (excluding transactions less than S$100,000 and transactions conducted under the shareholders' mandate pursuant to Rule 920)		Aggregate value of interested person transactions conducted under shareholders' mandate pursuant to Rule 920 (excluding transactions less than S$100,000)
	Name of interested person
				US$'000		US$'000
	Three months ended 30th June 2009
	Jardine Matheson Limited
	- Internal audit fee			-		26
	Six months ended 30th June 2009
	Jardine Matheson Limited
	- Internal audit fee			-		95

7	Issue of shares
	There have been no changes in the issued share capital of the Company since 31st December 2008.
	There are no outstanding convertibles issued or treasury shares held by the Company as at 30th June 2009.
	The total number of issued share capital (excluding treasury shares) as at 30th June 2009 and 31st December 2008 was 369,985,977.

8	Others
	The results do not include any pre-acquisition profits and have not been affected by any item, transaction or event of a material and unusual nature. No significant transaction or event has occurred between 30th June 2009 and the date of this report.

For further information, please contact:
MCL Land Limited
Steve Chu
Full text of the Financial Statements and Dividend Announcement for the six months ended 30th June 2009 can be accessed through the internet at www.mclland.com.sg.
	- end -

 

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