CapitaLand’s Unit Strengthens Foothold In China
CapitaLand’s wholly-owned serviced residence business unit, The Ascott Limited (Ascott), has secured a contract to manage its third property in China, the premier Ascott Raffles City Chengdu. The property, strategically located in the heart of Chengdu’s bustling business centre along Renmin Nan Road, will offer 296 luxurious apartments when it opens in 2013. Ascott Raffles City Chengdu is its third serviced residence within CapitaLand’s signature Raffles City brand of integrated developments. This follows Ascott’s recent contract wins to manage its first serviced residence in Xiamen, Citadines Jinshang Road Xiamen, and its second property in Wuhan, Somerset Wusheng Wuhan, which are scheduled to open in late 2012 and 2013 respectively.
Significance: The new properties will further enhance Ascott’s foothold in China’s high growth cities, which are also well-known tourist destinations. By strengthening its position in these cities, Ascott can tap into the growing demand for quality accommodation.
Keppel Land’s 1H12 Earnings Surges By 76.8%
Keppel Land announced a strong growth in its half year results led by the strong performance from property trading, improved performance from K-REIT Asia and higher fund management earnings. For the six-month period, its earnings jumped 76.8 percent to $236.6 million despite a 35 percent decline in total sales arising from lower takings from some its Singapore and overseas operations. For the three months however, Keppel Land recorded an 88 percent increase to $94.7 million while sales increased 25.1 percent to $130.3 million. A pick-up in overseas residential sales in projects, such as Jakarta Garden City in Indonesia and Phase 6 of The Botanica in Chengdu, helped shore up revenue for the quarter. Meanwhile, Keppel Land has acquired a site in Colombo, Sri Lanka and has entered into a joint venture with a local developer to build a 260-unit residential development there.
Significance: The company remains in a strong cash position of $1.6 billion and its net debt-to-equity ratio stood at 0.19, leaving it with adequate debt headroom for its regional acquisition plans to seek out sites with strong marketing attributes for residential, townships, commercial and mixed-use developments.
Qian Hu Reports Dip In 1H12 Revenue; Restructures Ornamental Fish Business
Ornamental fish service provider, Qian Hu reported a dip of 46.7 percent in net earnings to $532,000 on the back of a 4.3 percent fall in revenue to $22.4 million for the second quarter ended 30 June 2012. The fall was led by a substantial reduction in ornamental fish revenue as a result of intense price competition arising from an oversupply of Dragon Fish farms in Malaysia, which was partly cushioned by its new subsidiary in Indonesia and exports to more countries. For the half year, revenue was 9.6 percent lower at $42.9 million while earnings were nearly halved to $1.1 million. As such, the company will dispose its Malaysian subsidiary, Kim Kang Aquaculture and concentrate on producing premium Dragon Fish in Singapore as well as direct more efforts into its distribution network.
Significance: Qian Hu will receive $9.4 million for the sale of its entire stake in Kim Kang Aquaculture, which the management has proposed a special dividend of $0.005 per share around September 2013 after receiving the second tranche of cash proceeds.