Hyflux’s New Tuas Plant To Cost 18% More
According to a recent report by a specialist publication, Hyflux has turned to the Public utilities Board (PUB) to accept an 18 percent increase in upfront costs for Singapore’s second and largest desalination facility that is being built in Tuas. The report says that the cost increase arose from Hyflux’s choice of a higher-efficiency power plant will push the total development cost of its Tuaspring facility from $890 million to $1.05 billion. There already appears to be hiccups to the development of the desalination plant, with the plant set to be operational in 2014 – a delay from the earlier-targeted 2013 start-up. Tuaspring is expected to supply PUB with an additional 70 million gallons of water daily under a 25-year water purchase agreement. Hyflux is said to be arguing its case for the higher upfront project costs on the basis of expected lower operating costs from the higher-efficiency power plant.
Significance: Hyflux’s plan to supply any surplus power from its facility to the domestic power grid appears to be challenging as there is an expected oversupply of power due to expansion projects by power generators.
GLP Reports Significant Growth In FY12
Global Logistics Properties (GLP) released its FY12 earnings report card after trading hours on 24 May 2012 showcasing improved revenue as well as a strong operating cash flow. Full year revenue growth stood at 19.4 percent, driven by the completion of development projects and operational growth in China, as well as the favourable impact of currency translation. However, GLP’s earnings sagged 23.4 percent on the back of a stronger base established in FY11 due to US$456.3 million in revaluation gains. Putting that aside, earnings would have gained 25.6 percent on the back of strong operational performance. Jeffrey H. Schwartz, deputy chairman and chairman of the executive committee of GLP said that FY12 was a strong year for the firm as it continues to see strong leasing demand for its modern logistics facilities in both China and Japan. At the same time, GLP’s strong balance sheet and operating cash flow allows it to be primed to take advantage of any opportunities that may lie ahead. GLP has proposed a final year dividend of $0.03 per share.
Significance: During FY12, GLP has made great strides in establishing its fund management platform with the formation of two joint ventures. However, with a more moderate overall growth in China and reconstruction efforts ebbing in Japan, such stellar operational performance could be difficult to repeat.
Yoma Posts Stellar FY12 Earnings Results
Yoma Strategic Holdings saw its revenue grow about 3.5 times to $39.2 million as compared to $11.2 million in FY11 as it generated a large portion of income from the sale of land development rights (LDRs) and houses in Myanmar. In FY12, Yoma sold 222 plots of land as compared to 35 plots of land in the previous year. However, much of the increase in volume of LDRs sold was at FMI City where margins are much lower as the profit share attributable to Yoma is 52.5% versus 70% from a separate development at PHGE. Coupled with increase in administrative expenses, Yoma’s FY12 earnings managed to still grow by 116 percent to $6 million as opposed to $2.8 million in FY11. Cash generated from operations also improved greatly to $19.2 million as compared to $1 million in the previous year.
Significance: The positive segment in the real estate business in Myanmar has so far buoyed Yoma’s performance. Yoma maintains a positive outlook in this respect and expects the strong sales momentum to continue into FY13