http://www.businesstimes.com.sg/prem...2758m-20130828

Published August 28, 2013

Wing Tai's Q4 earnings rise 72% to $275.8m

It proposes to pay 12 cents in total dividends, up from seven cents before

By Kalpana Rashiwala [email protected]


WING Tai is proposing to reward shareholders with 12 cents in total dividends for the financial year ended June 30, 2013, up from seven cents in the preceding year, after reporting a strong set of results.

Group net profit rose 72 per cent year on year to $275.8 million in the fourth quarter on the back of a 52 per cent jump in revenue to $307.8 million. Full-year net profit doubled to $531.1 million from $262.4 million, while revenue leapt to $1.3 billion from $624.9 million.

Contributing to the higher topline were progressive sales booked from Foresque Residences and L'VIV, the additional units sold in Helios Residences and Belle Vue Residences (all in Singapore) as well as Verticas Residences in Malaysia. Verticas obtained Temporary Occupation Permit in the current year and the revenue for all the units sold as at the end of June 30, 2013 was fully recognised.

The group booked $52.1 million in fair value gains on investment properties for FY2013, more than three times the $15.7 million figure in FY2012.

Wing Tai's share of profits of associated and joint venture companies climbed 56 per cent to $294.8 million in FY2013 - due chiefly to higher share of profit form Wing Tai Properties Limited in Hong Kong.

Net gearing eased to 0.15 time at the end of June this year, from 0.17 time a year earlier. Return on equity increased from 11.8 per cent in FY2012 to 18.7 per cent in FY2013.

Earnings per share rose from 33.6 cents in FY2012 to 67.8 cents in FY2013. The counter closed one cent higher at $2.04 yesterday. Net asset value per share rose from $2.85 at end-June 2012 to $3.62 at end-June 2013.

Wing Tai released its results after the stockmarket close.

The group has recommended a 3-cent first and final dividend and 9-cent special dividend for FY2013. This compares with respective payouts of 3 cents and 4 cents in the previous year.

Wing Tai chairman Cheng Wai Keung said the group will launch its joint venture condo at Prince Charles Crescent in the fourth quarter of 2013. Designed by Toyo Ito, the 99-year leasehold condo will have 469 units.

Singapore accounted for 70 per cent of the group's revenue and 45 per cent of its earnings before interest and tax for FY2013. As at end-June this year, 61 per cent of its $5 billion total assets were allocated to Singapore. Wing Tai also operates in Malaysia, and Hong Kong and China.

For now, the group plans to stick to these four markets. "Three out of these four cities or countries (use) mostly English-based Common Law. And if you want property stability, well-functioning markets, you must have a predictable law. The Common Law is actually the most conducive for property development," said Mr Cheng. "Then you may ask: "How about China?" I would say China is mitigated by the prospect of the population, that they are still under-developed in residential property."

When quizzed about succession planning, Mr Cheng, 63, said: "Well, we always look for new blood into the company, but I am still relatively young. Of course this is not a reason for not looking at a successor but you look at the table here, there are plenty of successors here." At the table were his brother Edmund, who is Wing Tai's deputy chairman; executive director Tan Hwee Bin and CFO Ng Kim Huat. "But I am not thinking of retirement yet."

Chipping in, Mr Edmund Cheng, 61, said: "It's not just the chairman, but in terms of the board also. I think that in time to come I am sure that there will be more changes and even for the management, we do have our succession planning in place and we continue to evaluate that. . . (We have) people moving into different places; every year we will look at it and the order may be changed.

"So may be next year, then I will change and now become the chairman," he said drawing guffaws from everyone. "Just joking. I don't want to be kicked out!" he added.