Oxley Holdings full-year profits jumped 31% to $285.03m
Gains from its purchase of Chevron House boosted profits.
Oxley Holdings popped the champagne as its full-year profits for FY2018 jumped by 31% to $285.03m from $218.11m in FY2017. Revenue fell 11% to $1.19b from $1.34b FY2017.
For the fourth quarter, profits increased more than two-fold to $137.7m from $41.54m, whilst revenue grew by 4% to $233.06m from $224.33m FY2017.
Revenue fell mainly due to lower completion and handover of development projects in Singapore. They were offset by contributions from Chevron House and the new hotels at Stevens Road as well as higher revenue contribution from the project in the UK.
Chevron House’s office space and retail space are 98% and 100% rented out respectively. Meanwhile, Novotel Singapore and Mercure Singapore on Stevens have achieved “healthy” occupancy rates and room rates since opening less than a year ago, Oxley added.
For the fourth quarter, Oxley enjoyed a fair value gain of $111.2m comprising mainly of gains on the revaluation of Chevron House, a reversal of fair value loss on financial instrument of $24.2m, and a gain on sale of an investment property in Ireland of $20.2m.
Notably, finance costs for the full-year jumped by 55% to $46.4m due to the bank loans and bonds that supported its acquisitions and joint ventures. It also incurred higher interest rates brought about by the US Fed’s rate hikes.
“The pace of interest rate hikes by US Federal Reserve has an indirect impact on Singapore interest rates and will affect Oxley’s cost of borrowings and consumers’ propensity to take on debts for real estate purchases,” the company said.
The increase in the share of profit from equity-accounted associates and joint ventures was due mainly to higher results from Galliard Group Limited, Goldprime Land Pte Ltd, and The Bridge project at Oxley Diamond (Cambodia) Co., Ltd.
Oxley’s performance in the overseas markets will be affected by the local political, economic, and regulatory policies as well as the global economic condition and foreign exchange fluctuations, the company said.
“The outlook for the major overseas market is stable though the escalating trade tensions and fund outflow from the emerging markets to the United States may dampen the economies,” it added.
Oxley will distribute a final dividend of 0.78 cents at a date to be announced.
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