MCL Land Third Quarter Financ

RNS Number : 0838C

Hongkong Land Hldgs Ld

06 November 2009

 

 

MCL Land Limited

Third Quarter 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 November 2009

MCL LAND LIMITED

THIRD QUARTER 2009 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

Highlights

·     Profit attributable to shareholders US$134 million

·     Completion of The Fernhill, Tierra Vue and Hillcrest Villa

·     87% of the units in The Peak@Balmeg sold

"The completion of three development projects in the first nine months of the year will produce a good full-year performance and the strong cash flows generated will enhance further the Group's financial position."

Y K Pang, Chairman

6th November 2009

Group Results

				Nine months ended 30th September
				2009	2008	Change	2009	Change
				US$m	US$m	%	S$m	%
Revenue				421.8	78.8	435	602.4	435
Profit before tax				161.6	25.0	n/m	230.3	n/m
Profit attributable to shareholders				134.5	21.5	n/m	191.8	n/m
				US¢	US¢		S¢
Earnings per share				36.35	5.81	n/m	51.83	n/m
				At  30.9.2009	At  31.12.2008	Change	At  30.9.2009	Change
				US$m	US$m	%	S$m	%
Shareholders' funds				509.7	393.9	29	721.3	27
				US$	US$		S$
Net asset value per share				1.38	1.06	30	1.95	27

n/m = not meaningful

The exchange rate of US$1=S$1.42 (31.12.2008: US$1=S$1.44) was used for translating assets and liabilities at the balance sheet date and average monthly transaction rate of US$1=S$1.47 (2008: US$1=S$1.39) was used for translating the results for the financial period.

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

Overview

The Singapore residential property market continued to improve as sales activity increased in the third quarter of 2009. Prices increased strongly during the period and 5,578 new homes were sold, an increase of 20% from the second quarter. This brought the number of new homes sold in the first nine months of the year to 12,828. The increased activity primarily reflected strong demand for units in mid and mass market developments.

Group Performance

MCL Land recorded revenue of US$422 million in the first nine months of 2009, primarily due to the recognition of sales on the completion of The Fernhill, Tierra Vue and Hillcrest Villa. The revenue of US$79 million in the corresponding period of 2008 arose on the completion of Mera Springs. Net profit for the first nine months of 2009 was US$134 million, compared with US$21 million in 2008. Hillcrest Villa contributed revenue of US$277 million and a net profit of US$101 million in the third quarter of 2009.

Shareholders' funds were US$510 million at the end of September 2009, up from US$394 million at 31st December 2008 following the payment in May 2009 of a one-tier first and final dividend for 2008 of US$25 million. The Group's net debt and net gearing at 30th September 2009 were US$85 million and 17%, 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 nine months of 2009 (2008: nil).

Properties

No new development projects were launched by the Group during the period under review. At the end of September 2009, pre-sales had reached 38% at D'Pavilion, a 50-unit apartment development at Upper Serangoon Road, and 87% at The Peak@Balmeg, a 180-unit condominium development at Balmeg Road. Waterfall Gardens which is scheduled to complete in 2010 is fully pre-sold, as were all but two of the units at Hillcrest Villa.

Hillcrest Villa completed in September 2009 and the results for the period reflect the contribution from 146 units of the 161 units sold. The contribution from the remaining 15 units which have been pre-sold is expected in the fourth quarter. If the results from these additional units had been included, the revenue for the period would have been US$30 million higher and the profit US$12 million higher. The Fernhill and Tierra Vue were completed in the first quarter and second quarter of the year, respectively, and together contributed a net profit of US$39 million.

Construction of the Group's development projects is progressing well. 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 sq. m. 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 was 99% pre-sold at 30th September 2009. Sales of Seremban Forest Heights, the joint venture development in Seremban, continued with 168 of the 270 terrace houses, bungalows, bungalow lots and shop offices pre-sold.

Wangsa Walk in Kuala Lumpur, a retail mall development by the Group's joint venture company, MSL Properties, was completed and opened in August 2009. It has a net lettable area of 25,000 sq. m. of which 92% has been leased.

Prospects

The completion of three development projects in the first nine months of the year will produce a good full-year performance and the strong cash flows generated will enhance further the Group's financial position.

Y K Pang

Chairman

6th November 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 nine months ended 30th September 2009 to be false or misleading in any material respect.

On behalf of the Directors

Y K Pang

Chairman

Hassan Abas

Director

6th November 2009

MCL Land Limited
Consolidated Profit and Loss Account
			Three months ended					Nine months ended
			30.9.2009		30.9.2008	Change		30.9.2009		30.9.2008	Change
		Note	US$'000		US$'000	%		US$'000		US$'000	%
Revenue			277,680		78,072		256	421,783		78,790		435
Cost of sales			(155,621)		(57,542)		170	(253,066)		(57,542)		340
Gross profit			122,059		20,530		495	168,717		21,248		n/m
Other operating income			196		274	-	28	911		3,892	-	77
Property related expenses			(900)		(1,610)	-	44	(1,242)		(2,139)	-	42
Administrative expenses			(3,785)		(1,017)		272	(5,888)		(2,648)		122
Share of joint ventures' results			(309)		(1,377)	-	78	(885)		4,695		n/m
Profit before tax		2	117,261		16,800		n/m	161,613		25,048		n/m
Tax		3	(20,855)		(3,516)		493	(27,125)		(3,566)		n/m
Profit after tax attributable to
	shareholders		96,406		13,284		n/m	134,488		21,482		n/m
			US¢		US¢		%	US¢		US¢		%
Earnings per share ("EPS")
	attributable to shareholders
	- basic and diluted*	4	26.06		3.59		n/m	36.35		5.81		n/m
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 September
Consolidated Statement of Comprehensive Income for the three months ended 30th September
			2009		2008
			US$'000		US$'000
Profit after tax			96,406		13,284
Translation difference			9,551		(25,634)
Total comprehensive income/(loss) attributable to shareholders			105,957		(12,350)
Consolidated Statement of Changes in Equity for the three months ended 30th September
		Attributable to shareholders
		Share	Translation	Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st July		276,657	106,605	20,498	403,760
Comprehensive income for the financial period		-	9,551	96,406	105,957
Balance at 30th September		276,657	116,156	116,904	509,717
2008
Balance at 1st July		276,657	135,978	123,395	536,030
Comprehensive (loss)/income for the financial period		-	(25,634)	13,284	(12,350)
Balance at 30th September		276,657	110,344	136,679	523,680

MCL Land Limited
Consolidated Statements of Comprehensive Income and Changes in Equity
for the nine months ended 30th September
Consolidated Statement of Comprehensive Income for the nine months ended 30th September
			2009		2008
			US$'000		US$'000
Profit after tax			134,488		21,482
Translation difference			6,773		5,116
Total comprehensive income attributable to shareholders			141,261		26,598
Consolidated Statement of Changes in Equity for the nine months ended 30th September
		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 income for the financial period		-	6,773	134,488	141,261
Dividend		-	-	(25,493)	(25,493)
Balance at 30th September		276,657	116,156	116,904	509,717
2008
Balance at 1st January		276,657	105,228	142,288	524,173
Comprehensive income for the financial period		-	5,116	21,482	26,598
Dividend		-	-	(27,091)	(27,091)
Balance at 30th September		276,657	110,344	136,679	523,680

MCL Land Limited
Consolidated Balance Sheet
								At		At
								30.9.2009		31.12.2008
						Note		US$'000		US$'000
Non-current assets 1
Plant and equipment								134		212
Investment properties								16,017		15,985
Investments in joint ventures								33,266		34,739
Deferred tax assets								647		874
								50,064		51,810
Current assets 2
Development properties for sale								535,115		683,534
Amounts owing by joint ventures								65,177		62,018
Debtors and prepayments								177,952		80,797
Bank balances								116,649		131,800
								894,893		958,149
Total assets								944,957		1,009,959
Non-current liabilities 3
Borrowings						5		201,285		298,242
Deferred tax liabilities								464		459
Creditors								1,072		-
Retention money payable								5,110		7,137
								207,931		305,838
Current liabilities 4
Borrowings						5		-		14,871
Amounts owing to joint venture								466		459
Creditors								198,166		277,437
Current tax liabilities								28,677		17,405
								227,309		310,172
Total liabilities								435,240		616,010
Net assets								509,717		393,949
Equity:
Share capital and reserves
Share capital								276,657		276,657
Translation reserve								116,156		109,383
Retained earnings								116,904		7,909
Shareholders' funds								509,717		393,949
Net asset value per share								US$1.38		US$1.06

Explanatory notes on material variances:
1	The decrease in non-current assets at 30.9.2009 as compared to 31.12.2008 is mainly due to the loss incurred from the Group's joint ventures.
2	The decrease in current assets is mainly due to recognition of the cost of development properties for sale in the profit and loss account upon the projects' completion during the current period. In addition, bank balances decreased as a result of repayment of the Group's borrowings. This is partially offset by the higher debtors and prepayments for progress billings upon the projects' completion during the current period.
3	The lower non-current liabilities at 30.9.2009 as compared to 31.12.2008 is mainly due to repayment of long-term bank loans during the financial period from progress billings collected from the Group's development properties.
4	The lower current liabilities at 30.9.2009 as compared to 31.12.2008 is mainly due to repayment of short-term bank loans during the period from progress billings collected and recognition of revenue in the profit and loss account upon the projects' completion during the current period. This is partially offset by higher provision of income tax for the Group's taxable profit.

MCL Land Limited
Company Balance Sheet
							At		At
							30.9.2009		31.12.2008
							US$'000		US$'000
Non-current assets
Plant and equipment							114		182
Interests in subsidiaries							57,077		58,909
Investments in joint ventures							28,242		27,773
							85,433		86,864
Current assets
Amounts owing by subsidiaries							285,360		353,289
Amounts owing by joint ventures							65,177		62,018
Debtors and prepayments							302		280
Bank balances							64,697		70,916
							415,536		486,503
Total assets							500,969		573,367
Non-current liability
Borrowings							45,933		45,170
Current liabilities
Borrowings							-		9,034
Amounts owing to subsidiaries							82,692		35,564
Amounts owing to joint venture							466		459
Creditors							4,064		3,336
Current tax liabilities							139		2,284
							87,361		50,677
Total liabilities							133,294		95,847
Net assets							367,675		477,520
Equity:
Share capital and reserves
Share capital							276,657		276,657
Translation reserve							99,114		96,048
(Accumulated loss)/Retained earnings							(8,096)		104,815
Shareholders' funds							367,675		477,520
Net asset value per share							US$0.99		US$1.29

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th September
Company Statement of Comprehensive Income for the three months ended 30th September
			2009		2008
			US$'000		US$'000
Loss after tax			(12,672)		(610)
Translation difference			8,945		(21,792)
Total comprehensive loss attributable to shareholders			(3,727)		(22,402)
Company Statement of Changes in Equity for the three months ended 30th September
		Attributable to shareholders
				(Accumulated
		Share	Translation	loss)/Retained	Total
		capital	reserve	earnings	equity
		US$'000	US$'000	US$'000	US$'000
2009
Balance at 1st July		276,657	90,169	4,576	371,402
Comprehensive income/(loss) for the financial period		-	8,945	(12,672)	(3,727)
Balance at 30th September		276,657	99,114	(8,096)	367,675
2008
Balance at 1st July		276,657	120,545	60,750	457,952
Comprehensive loss for the financial period		-	(21,792)	(610)	(22,402)
Balance at 30th September		276,657	98,753	60,140	435,550

MCL Land Limited
Company Statements of Comprehensive Income and Changes in Equity
for the three months ended 30th September
Company Statement of Comprehensive Income for the nine months ended 30th September
					2009				2008
					US$'000				US$'000
(Loss)/Profit after tax					(87,418)				2,277
Translation difference					3,066				5,392
Total comprehensive (loss)/income attributable to shareholders					(84,352)				7,669
Company Statement of Changes in Equity for the nine months ended 30th September
			Attributable to shareholders
							(Accumulated
			Share		Translation		loss)/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 income/(loss) for the financial period			-		3,066		(87,418)		(84,352)
Dividend			-		-		(25,493)		(25,493)
Balance at 30th September			276,657		99,114		(8,096)		367,675
2008
Balance at 1st January			276,657		93,361		84,954		454,972
Comprehensive income for the financial period			-		5,392		2,277		7,669
Dividend			-		-		(27,091)		(27,091)
Balance at 30th September			276,657		98,753		60,140		435,550

MCL Land Limited
Consolidated Statement of Cash Flows
			Three months ended				Nine months ended
			30.9.2009		30.9.2008		30.9.2009		30.9.2008
			US$'000		US$'000		US$'000		US$'000
Profit before tax			117,261		16,800		161,613		25,048
Non-cash items
	Interest income		(177)		(241)		(722)		(1,051)
	Share of joint ventures' results		309		1,377		885		(4,695)
	Depreciation		26		41		98		127
	Loss on disposal of plant and equipment		-		-		1		-
	Unrealised translation gain		(2)		(4)		(4)		(13)
			156		1,173		258		(5,632)
Operating profit before working capital changes			117,417		17,973		161,871		19,416
Changes in working capital
	Development properties for sale		116,339		(10,139)		164,370		(287,967)
	Amounts owing by joint ventures		(785)		2,012		(897)		41,708
	Debtors and prepayments		(121,780)		(40,704)		(97,077)		103,509
	Creditors		(87,879)		3,465		(86,776)		48,345
			(94,105)		(45,366)		(20,380)		(94,405)
Cash flows generated from/(used in) operations			23,312		(27,393)		141,491		(74,989)
	Interest paid		(1,295)		(2,056)		(4,099)		(6,489)
	Interest received		175		250		732		1,096
	Income tax paid		(7,589)		(4,922)		(15,723)		(11,721)
			(8,709)		(6,728)		(19,090)		(17,114)
	Net cash flows generated from/(used in) operating activities 5		14,603		(34,121)		122,401		(92,103)
Cash flows from investing activities
	Purchase of plant and equipment		(16)		(6)		(22)		(16)
	Net proceeds from sale of plant and equipment		-		1		-		1
	Net cash flows used in investing activities		(16)		(5)		(22)		(15)
Cash flows from financing activities
	Drawdown of loans		5,615		55,324		57,269		262,192
	Repayment of loans		(80,150)		(23,904)		(170,489)		(164,383)
	Dividend paid		-		-		(25,493)		(27,091)
	Net cash flows (used in)/provided by financing activities 6		(74,535)		31,420		(138,713)		70,718
Net change in cash and cash equivalents			(59,948)		(2,706)		(16,334)		(21,400)
Cash and cash equivalents at the beginning of the
	financial period		173,200		65,118		131,800		78,419
Effect of exchange rate changes			3,397		(2,722)		1,183		2,671
Cash and cash equivalents at the end of the financial period			116,649		59,690		116,649		59,690
Explanatory notes on material variances:
5	The net cash flows generated from operating activities for the nine months ended 30th September 2009 relates mainly to progress billings collected from the Group's development properties.
6	The net cash flows used in financing activities for the nine months ended 30th September 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
		IAS 27	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						Nine months ended
				30.9.2009		30.9.2008		Change		30.9.2009		30.9.2008		Change
				US$'000		US$'000		%		US$'000		US$'000		%
	Profit before tax is determined
		after including:
	Net exchange (loss)/gain			(1)		-		n/m		(1)		12		n/m
	Rental income			265		303	-	13		810		1,021	-	21
	Interest income			177		241	-	27		722		1,051	-	31
	Depreciation on plant and equipment			(26)		(41)	-	37		(98)		(127)	-	23
	Loss on disposal of plant and equipment			-		-		n/m		(1)		-		n/m
	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				Nine months ended
				30.9.2009		30.9.2008		30.9.2009		30.9.2008
	Basic earnings per share*
	Profit attributable to shareholders (US$'000)			96,406		13,284		134,488		21,482
	Weighted average number of ordinary shares
		in issue ('000)		369,986		369,986		369,986		369,986
	Basic earnings per share (US¢)			26.06		3.59		36.35		5.81
	* Diluted EPS is the same as basic EPS, as there were no outstanding share options.
5	Group borrowings
								Group
								At		At
								30.9.2009		31.12.2008
								US$'000		US$'000
	Borrowings due within one year
		- unsecured						-		9,034
		- secured						-		5,837
								-		14,871
	Borrowings due after one year
		- unsecured						45,933		45,170
		- secured						155,352		253,072
								201,285		298,242
								201,285		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 September 2009 was US$345.4 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 September 2009
	Jardine Matheson Limited
	- Internal audit fee			-				13
	Cycle & Carriage Industries Pte Limited
	- Sale of vehicle			-				71
	- Purchase of vehicle			-				223
	Nine months ended
	30th September 2009
	Jardine Matheson Limited
	- Internal audit fee			-				108
	Cycle & Carriage Industries Pte Limited
	- Sale of vehicle			-				71
	- Purchase of vehicle			-				223
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 September 2009.
	The total number of issued share capital (excluding treasury shares) as at 30th September 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 September 2009 and the date of this report.
	- end -
For further information, please contact:
MCL Land Limited
Steve Chu
Full text of the Financial Statements and Dividend Announcement for the nine months ended 30th September 2009 can be accessed through the internet at www.mclland.com.sg.

 

END

 

 

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