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Published May 13, 2010

Soilbuild's Q1 profit dives 48%

By FELDA CHAY


PROPERTY developer Soilbuild Group said yesterday its revenue and net profit slipped in the first quarter, although it expects to remain profitable for the year.

For the period ended March 31, Soilbuild reported a net profit of $10 million, a 48 per cent fall from its net profit of $19.1 million a year ago. Gross profit fell 21 per cent to $16.5 million from $20.8 million last year. Revenue also fell 50 per cent to $32.4 million from $64.7 million in the year-ago period.

Soilbuild said in a statement that the fall was due largely to the absence of contributions from three of its residential property projects, namely The Espa, The Centrio and Leonie Parc View, which were completed last year.

The fall in revenue was partially offset by an increase in rental income, which grew 40 per cent to $4.4 million as compared with last year.

Despite the drop, Soilbuild said it expects to make a profit for the year 'with the progressive recognition of revenue from the sold residential and business space property units, with maiden contributions in the second half of the year'.

It is expecting contributions from four ongoing developments such as The Mezzo, where all residential units are fully sold, and Woodlands BizHub, a commercial space project which is also fully sold.

The group said it added $110 million in orders to its order book from new sales of 96 residential and business space units in projects such as West Point BizHub - a turnkey development and marketing project it is working on with CSC Holdings subsidiary, Kolette.

Said Low Soon Sim, executive director of Soilbuild: 'The group has been well-positioned to harness opportunities, particularly in the business space segment, where demand has been bolstered by the strong economic recovery. This has underpinned the sales of our residential and business space properties as well as the leasing of our investment properties.'

Soilbuild, he said, remains on course to meet its $40 million target for recurrent rental income with the expected completion of Solaris at one-north by the fourth quarter.

Yesterday, Soilbuild's shares closed higher by 2 cents, or 1.5 per cent, to $1.36.