Singapore Daily Bulletin – 24/01/13

Keppel Land’s 4Q12 Earnings Fall 55% To $527.3m
Keppel Land’s earnings for the fourth quarter ended 31 December 2012 fell 55.4 percent to $527.3 mainly due to the absence of a gain from selling a stake in Ocean Financial Centre in the same quarter last year. On the other hand, 4Q12 revenue increased 25.8 percent to $471.9 million. Segmental wise, the Property Trading’s net income jumped 68.5% to $323.9 million. The property investment achieved a 17.8 percent increase in net profit to $82 million while the Group’s fund management vehicles, Keppel REIT Management and Alpha Investment Partners (Alpha), contributed $50.4 million, accounting for 11 percent of net profit excluding divestment and revaluation gains. Keppel Land also proposed a final dividend of 12 cents per share.

Significance: Keppel Land is of the view that 2013 will be another challenging year. Yet, with a huge cash position of $1.6 billion, this will certainly provide the firm in seizing any opportunity that arises.

Ascott REIT’s 4Q12 DPU Jumps 9% At 2 Cents
Ascott Residence Trust’s (Ascott REIT) unitholders’ distribution for the fourth quarter ended 31 December 2012 jumped 10 percent to $22.8 million. Distribution per unit (DPU) for the quarter was 2 cents, up 9 percent from 1.83 cents a year ago. 4Q12 revenue was flat at $75.9 million, but inched up 5 percent year-on-year to $303.8 million for the full year, driven mainly by contributions from its newly acquired properties and a stronger performance from its serviced residences in China, the United Kingdom and the Philippines. The REIT announced a distribution rate of 4.238 cents per unit for the half-year period to 31 December, which will be paid on 28 February.

Significance: Looking ahead, Ascott REIT is positive that its income will remain sustainable as the Asian economy continues to grow, and income from its European portfolio remains stable. In addition, the REIT said it will continue to invest in renovations of its properties, adding that both the Citadines Trafalgar Square and Ascott Jakarta have a very strong response.

Fincantieri Makes Unconditional Cash Offer For STX OSV
Fincantieri, one of the world’s largest shipbuilding groups, through its wholly owned subsidiary Fincantieri Oil & Gas S.p.A. has successfully completed the acquisition of 50.8 percent of STX OSV from STX Europe, at a price of $ 1.22 per share, totalling approximately euro 455 million (approximately $730 million). In compliance with the rules of the Singapore Code on Take-overs and Mergers, Fincantieri Oil & Gas S.p.A. has also announced its intention to make a mandatory unconditional cash offer for the remaining shares at a price of $1.22 per share. The value of the transaction, including both the acquisition of the 50.8 percent stake and assuming the mandatory unconditional cash offer is taken, will amount to approximately euro 900 million, or approximately $1.5 billion.

Significance: There is no intention for Fincantieri to maintain the listing status of STX OSV on SGX if it accumulates over 90 percent of the counter. That said, OSK Research is of opinion that Fincantieri’s general offer for STX OSV’s remaining shares is unlikely to be successful. Notably, Och-Ziff, the second largest shareholder, has a 12 percent stake.