PropNex's Q1 net profit more than triples on higher property transactions

Fri, May 15, 2020

Lynette Tan


REAL estate agency PropNex on Thursday posted S$8.2 million in net earnings for the first quarter, more than triple that of the S$2.3 million in the preceding year, boosted by property transactions carried forward and a recovery in the private home market.

Revenue gained 82.7 per cent to S$135.6 million for the quarter ended March 31.

The mainboard-listed group said it finished 2019 with more than S$500 million in gross commission from its total property transactions. Transactions yielding about S$420 million in commission were completed and invoiced that year, and the remaining transactions have been carried forward.

PropNex also attributed the growth in revenue to a recovery of the private residential market from the government-imposed cooling measures. For instance, the private new home sales segment saw 2,149 units moved in Q1, a 16.9 per cent increase from the same period a year ago.

Earnings per share for the quarter stood at 2.05 Singapore cents, up from 0.54 cent in the preceding year.

However, PropNex warned that the private residential segment could see an overall contraction in 2020. It expects most of the impact to be reflected in its financial performance for the second half of the year.

This comes as property viewings and marketing roadshows have been suspended during Singapore's circuit breaker period.

"Even before the circuit breaker measures, many existing owners had postponed their decision on selling, as they were not comfortable with inviting potential buyers to their homes," PropNex added.

In addition, developers are adopting a wait-and-see approach to their project launches, PropNex said.

That said, the group expects 30 projects with a total of close to 10,000 units to be rolled out in the subsequent quarters. It has been appointed for 14 projects comprising more than 6,500 units.

Shares of PropNex closed down 2.02 per cent to S$0.485 on Thursday before the announcement.