Metro’s FY08 net profit slips 4%

Metro’s FY08 net profit slips 4%


SINGAPORE – Metro Holdings on Wednesday reported net profit for the full year ended March 31, 2008 fell by 4 per cent to about $66 million (US$48 million).


Revenue for the year rose 4.78 per cent to $224.41 million driven mainly by its property development and investment division, whilst its retail operations saw a marginal decline.


The weaker net profit was attributed to a higher tax charge which rose from $10.8 million to $20.2 million and a prior year exceptional gain of $29.1 million from the sale of about half of the group’s investment in Shui On Land’s shares in FY2007.


However, these were offset by a gain of $31.9 million from the disposal of Gurney Plaza in Penang and higher gains of $14.9 million from fair value adjustments on investment properties in FY2008 compared to $2.9 million recorded the previous year.


Profit from operating activities increased by 12.3 per cent from $49.5 million in FY2007 to $55.6 million in FY2008. This increase was partly attributed to premium rental rates attained as a result of good demand for its properties in China.


The group’s property development and investment division, which had been built up since it first entered the property sector in China in 1988, continues to be the key contributor to Metro’s bottom-line.


In FY2008, this division contributed $75.6 million representing 87.4 per cent to the group’s pretax profit.


The property unit also saw the maiden contribution from Metro City Beijing, which was fully opened in September 2007, higher rental income from Metro City Shanghai.


On the retail front, Metro Tampines was closed on August 2007. Its closure was mitigated by a well-supported closing down sale and improved sales at the group’s remaining Metro outlets in Singapore.


Metro reported total shareholders’ equity of $879.6 million, a cash position of $173.7 million and relatively low net gearing of 0.2 times.


It is proposing an ordinary final dividend of one Singapore cent per share.


Together with the interim and special dividends paid out in December 2007, the total dividend for FY2008 is five Singapore cents per ordinary share.


Going forward, Metro expects its properties to generate a steady flow of rental income. On the retail front, plans are underway to open two new stores in Singapore and Indonesia in 2009.


It plans to work with strategic partners to expand its business in China and explore new opportunities when they arise. — BT newsroom


Source: Business Times

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