Full Year Financial Statement And Dividend Announcement

Transcription

1 KEPPEL LAND LIMITED Full Year Financial Statement And Dividend Announcement 1 UNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER The Directors of Keppel Land Limited advise the following unaudited results of the Group for the year ended 31 December. 1 (a) GROUP PROFIT AND LOSS ACCOUNTS for the year ended 31 December +/() % SALES 678, , COST OF SALES (512,391) (147,900) GROSS PROFIT 166, , Marketing expenses (2,738) (2,299) 19.1 Administrative expenses (35,681) (29,554) 20.7 OPERATING PROFIT 127, , Interest and investment income 15,008 21,334 (29.7) Interest expense (30,127) (26,538) 13.5 Share of results of associated companies 22,410 15, PROFIT BEFORE EXCEPTIONAL ITEMS 135, , Exceptional items (25,800) (67,886) (62.0) PROFIT BEFORE TAXATION 109,462 61, Taxation (11,432) (32,780) (65.1) PROFIT AFTER TAXATION 98,030 28, Minority interests 2,521 (2,150) nm PROFIT ATTRIBUTABLE TO SHAREHOLDERS 100,551 26, Comprising : Profit before exceptional items but after tax 126,351 94,259 Exceptional items (25,800) (67,886) Profit attributable to shareholders 100,551 26,373 Exceptional items consist of : Impairment charge in respect of Myanmar hotels (25,800) Loss on sale of Capital Square (70,386) Gain on sale of Bayswater Village 2,500 (25,800) (67,886) Keppel Land Limited, Page 1 of 18

2 Basic earnings per share (cents) Diluted earnings per share (cents) Profit attributable to shareholders is arrived at after charging / (crediting) the following: Depreciation 13,646 15,355 Provision for doubtful debts and bad debts written off (1,076) 2,350 Foreign exchange (gain) / loss 3,101 (2,203) Adjustment for over provision of tax in respect of prior years (4,912) Keppel Land Limited, Page 2 of 18

3 1(b) BALANCE SHEETS as at 31 December Group Company SHARE CAPITAL 354, , , ,310 RESERVES 1,131,958 1,125,978 1,131,958 1,125,978 SHARE CAPITAL AND RESERVES 1,486,904 1,480,288 1,486,904 1,480,288 MINORITY INTERESTS 206, ,604 LONGTERM BORROWINGS 1,853,129 1,914,106 1,461,133 1,596,294 3,546,335 3,583,998 2,948,037 3,076,582 Represented by: FIXED ASSETS 242, , INVESTMENT PROPERTIES 1,492,700 1,636,048 PROPERTIES HELD FOR DEVELOPMENT 195, ,798 INVESTMENTS Subsidiary companies 2,733,685 2,670,338 Associated companies 841, , , ,086 Other investments 55,574 53,058 4,120 4, , ,636 3,024,514 3,023,544 PROCEEDS FROM SALE OF RESIDENTIAL RECEIVABLES (302,000) (302,000) CURRENT ASSETS Properties held for sale 1,171,861 1,340,920 Stocks 3,396 3,246 Debtors 133, ,266 27,561 32,666 Amounts owing by holding and related companies 145,605 70, ,394 37,841 Fixed deposits, bank balances and cash 382, ,436 36,246 4,426 Less: CURRENT LIABILITIES 1,837,255 1,713, ,201 74,933 Creditors 495, ,893 5,477 8,535 Net tax provision 40,787 38,989 1,564 4,404 Shortterm borrowings 247, , , , , ,857 12,939 NET CURRENT ASSETS / (LIABILITIES) 1,052,955 1,091,711 (71,656) 61,994 Deferred taxation (31,527) (36,443) (4,899) (9,039) 3,546,335 3,583,998 2,984,037 3,076,582 Keppel Land Limited, Page 3 of 18

4 1(b)(ii) GROUP'S BORROWINGS AND DEBT SECURITIES Amount repayable in one year or less, or on demand As at 31 December As at 31 December Secured Unsecured Secured Unsecured 247,816 39, ,763 Amount repayable after one year As at 31 December As at 31 December Secured Unsecured Secured Unsecured 214,934 1,638, ,699 1,732,407 Details of any collateral Certain subsidiaries of the Company pledged their assets in order to obtain loans from financial institutions. The net book value of properties and other assets pledged/mortgaged to financial institutions amounted to $449.1 million ( : $498 million). Keppel Land Limited, Page 4 of 18

5 1(c) CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 December CASH FLOW FROM OPERATING ACTIVITIES: Operating profit before interest, taxation and exceptional items 127, ,215 Adjustments for: Depreciation of fixed assets 13,646 15,355 Provision for writedown in investments 7,000 Provision / (writeback) of provision for doubtful debts (1,076) 2,350 Write back for properties held for development (13,918) (22,000) Other items (311) Operating income before reinvestment in working capital 126, ,609 Decrease / (increase) in debtors (13,131) 38,862 Decrease / (increase) in consumable stocks and workinprogress (50,601) 486 Development expenditure (251,691) (356,525) Proceeds from progress billings 455,753 40,113 Proceeds from sale of residential receivables 302,000 Increase / (decrease) in creditors 51,218 (3,675) Cash generated from operations 318, ,870 Income from investment received Interest received 8,436 12,074 Income from interests in associated undertakings 5,679 9,025 Interest paid (30,127) (26,538) Income taxes paid (12,619) (24,882) NET CASH PROVIDED BY OPERATING ACTIVITIES 290, ,784 CASH FLOW FROM INVESTING ACTIVITIES: Purchase of fixed assets and investment properties (2,319) (4,430) Divestment of marketable securities and other investments 4,484 14,509 Proceeds from sale of fixed assets 62 23,473 Sale of shares in subsidiary companies 61,249 2,227 94,801 CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issuance of share capital by company 1, Net loan drawdown / (repayment) 51,760 (189,495) Advances from minority shareholders of certain subsidiaries 4,606 8,935 Loans from / (to) related and associated companies, less dividends (67,334) 4,848 Dividends paid to shareholders (19,347) (16,553) Dividends from / (to), and contribution by minority shareholders of subsidiary companies 11,001 (4,941) (17,956) (197,158) NET INCREASE IN CASH AND CASH EQUIVALENTS 274,704 10,427 CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 225, ,641 EXCHANGE ADJUSTMENTS DECONSOLIDATION (7,051) CASH AND CASH EQUIVALENTS AT END OF THE YEAR 500, ,370 Keppel Land Limited, Page 5 of 18

6 1(c) CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 December REPRESENTED BY: CASH AND CASH EQUIVALENTS Fixed deposits, bank balances and cash 382, ,436 Deposits with related companies 118,377 57,241 Shortterm borrowings from related companies (11,307) 500, ,370 Cash and cash equivalents of $500.9 million as at 31 December include $52.3 million held in escrow account for the payment of construction cost of Amaranda Gardens, Butterworth 8 and The Edgewater, whose receivables from the sale of these projects have been monetised. The acquisition and disposal of shares in subsidiary companies have been shown as separate items, and their effect on the individual assets and liabilities of the Group is not reflected in the above statement. The net assets of subsidiary companies sold, acquired or reclassified as associated companies may be analysed as follows: Investment properties 568,846 Net sale proceeds 46,234 Stocks, debtors and creditors (41,377) Net bank balances, cash and deposits with, and deposits from related company 7,051 Bank borrowings (368,000) Minority interests (49,900) 116,620 Loss on sale (70,386) 46,234 46,234 Keppel Land Limited, Page 6 of 18

7 1(d)(i) STATEMENTS OF CHANGES IN EQUITY for the year ended 31 December GROUP STATEMENT OF CHANGES IN EQUITY for the year ended 31 December Property Revaluation and Foreign Currency Share Share Other Capital Translation Retained Capital Premium Reserves Account Profit Total Balance at 1 January 354, , ,582 (132,049) (88,666) 1,480,288 Net deficit on revaluation of investment properties (124,962) (124,962) Net deficit on revaluation of property held for sale (10,566) (10,566) Exchange differences written back / arising on consolidation 81,157 81,157 Net gain / (losses) not recognised in profit and loss account (135,528) 81,157 (54,371) Net profit for the year 100, ,551 Total recognised gains and loss for the year (135,528) 81, ,551 46,180 Issue of shares under the Keppel Land Share Option Scheme ,358 Net revaluation surplus realised and transferred to profit and loss account (21,575) (21,575) Final dividend for the previous year, paid (19,347) (19,347) Balance at 31 December 354, , ,479 (50,892) (7,462) 1,486,904 Keppel Land Limited, Page 7 of 18

8 GROUP STATEMENT OF CHANGES IN EQUITY for the year ended 31 December Balance at 1 January Property Revaluation and Share Share Other Capital Foreign Currency Translation Retained Capital Premium Reserves Account Profit Total As previously reported 354, , ,409 (137,982) (64,392) 1,617,408 Adjustment for changes in accounting policies (35,059) (35,059) As restated 354, , ,409 (137,982) (99,451) 1,582,349 Net deficit on revaluation of investment properties (164,420) (164,420) Exchange differences arising on consolidation (15,544) (15,544) Exchange differences arising on foreign currency borrowings 21,784 21,784 Net gain / (losses) not recognised in profit and loss account (164,420) 6,240 (158,180) Net profit for the year 26,373 26,373 Total recognised gains and losses for the year (164,420) 6,240 26,373 (131,807) Issue of shares under the Keppel Land Share Option Scheme Revaluation deficit realised and transferred to profit and loss account on sale of a subsidiary company 18,083 18,083 Revaluation deficit realised and transferred to profit and loss account on sale of a property 26,943 26,943 Adjustment for changes in Group structure 567 (307) 965 1,225 Final dividend for the previous year, paid (16,553) (16,553) Balance at 31 December 354, , ,582 (132,049) (88,666) 1,480,288 Keppel Land Limited, Page 8 of 18

9 COMPANY STATEMENT OF CHANGES IN EQUITY for the year ended 31 December Balance at 1 January Property Revaluation and Other Foreign Currency Translation Share Share Capital Retained Capital Premium Reserves Account Profit Total As previously reported 354, ,111 (60,753) 374,620 1,480,288 Currency translation gain not recognised in profit and loss account 9,593 9,593 Net profit for the year 15,012 15,012 Total recognised gains for the year 9,593 15,012 24,605 Issue of shares under the Keppel Land Share Option Scheme ,358 Final dividend for the previous year, paid (19,347) (19,347) Balance at 31 December 354, ,833 (51,160) 370,285 1,486,904 Keppel Land Limited, Page 9 of 18

10 COMPANY STATEMENT OF CHANGES IN EQUITY for the year ended 31 December Balance at 1 January Property Revaluation and Other Foreign Currency Translation Share Share Capital Retained Capital Premium Reserves Account Profit Total As previously reported 354, ,086 79,373 (82,537) 454,199 1,617,408 Adjustment for change in accounting policy (25,682) (9,377) (35,059) As restated 354, ,086 53,691 (82,537) 444,822 1,582,349 Net deficit on revaluation of subsidiary and associated companies (36,298) (36,298) Exchange differences on foreign currency borrowings 21,784 21,784 Net gain / (losses) not recognised in profit and loss account (36,298) 21,784 (14,514) Net profit for the year (53,649) (53,649) Total recognised gains and losses for the year (36,298) 21,784 53,649) (68,163) Issue of shares under the Keppel Land Share Option Scheme Net revaluation surplus realised and transferred to profit and loss account (17,393) (17,393) Final dividend for the previous year, paid (16,553) (16,553) Balance at 31 December 354, ,111 (60,753) 374,620 1,480,288 Keppel Land Limited, Page 10 of 18

11 1(d)(ii) SHARE CAPITAL During the financial year, the Company issued 1,271,000 ordinary shares of $0.50 each upon the exercise of options granted under the Keppel Land Share Option Scheme to employees. The share capital of the Company as at the end of the financial year was 709,890,081 ordinary shares of $0.50 each. As at 31 December, there were unexercised options for 10,716,500 of unissued ordinary shares of $0.50 each under the Keppel Land Share Option Scheme. 2. AUDIT The figures have not been audited nor reviewed by the Company s auditors. 3. AUDITORS REPORT Not applicable. 4. ACCOUNTING POLICIES The Group has applied the same accounting policies and methods of computation in the financial statements for the current financial year compared with those for the audited financial statements as at 31 December. 5. CHANGES IN THE ACCOUNTING POLICIES There are no changes in accounting policies. 6. EARNINGS PER ORDINARY SHARE Earnings per ordinary share of the Company for the financial year based on Group net profit attributable to shareholders: G R O U P +/()% (i) Based on the weighted average number of shares Weighted average number of shares ( 000) , ,596 (ii) On a fully diluted basis Adjusted weighted average number of shares ( 000) 708, ,964 Keppel Land Limited, Page 11 of 18

12 7. NET ASSET VALUE G R O U P C O M PA N Y +/()% +/()% Net asset value per ordinary share based on issued share capital at the end of the financial year ($) REVIEW OF GROUP PERFORMANCE Group turnover for the year increased by 127% to $678.8 million compared with last year's turnover of $298.9 million due mainly to higher progressive recognition of sales for the Group's trading projects under development. Contributions also came from the sale during the year of three Cluny Hill land plots and the Norfolk Garden site. Rental income from the Group's office buildings in Singapore was, however, reduced due to the soft office market in, and the disposal of Capital Square in November. Group pretax profit before exceptional items was $135.3 million, 5% higher than that for last year. This improvement came on the back of higher earnings from One Park Avenue, Caribbean at Keppel Bay, the sale of three Cluny Hill land plots, the writeback of provisions for the Norfolk Garden site and further cost adjustments from completed projects which include Freesia Woods and The Edgewater. The better performance from property trading was partly offset by lower rental income from the Group's office buildings in Singapore, higher losses incurred by its hotels and resorts, and higher net interest expense due to funding for new projects and certain associated companies. The Group took an impairment charge of $25.8 million against its two hotels in Myanmar as an exceptional item in the results for the year. Group tax expense of $11.4 million was lower than that of $32.8 million for notwithstanding the better pretax profit. This was due to the benefit of group tax relief and a writeback of deferred tax provision. After taking into account exceptional items, Group attributable profit of $100.6 million was higher than previous year's corresponding profit of $26.4 million. As a result of the soft property market in, the Group revalued its Singapore investment properties downwards by a net amount of $143 million. This revaluation deficit was charged against the $535 million surplus accumulated under capital reserves in the balance sheet as at 31 December. Shareholders funds as at end amounted to $1.49 billion (: $1.48 billion). In the opinion of the Directors, no factor has arisen between 31 December and the date of this report which would materially affect the results of the Group and the Company for the year just ended. 9. VARIANCE FROM PROSPECT STATEMENT On prospects for made by the Company in its announcement of results for the year ended 31 December, it was stated that "barring unforeseen circumstances, and excluding exceptional gains or losses, the Group expects to maintain the level of profit in the coming year." Profit before exceptional items but after tax for was $126.4 million compared with $94.3 million for. The actual profit for is, therefore, better than previously forecast for the reasons explained in the above review of the Group's performance. Keppel Land Limited, Page 12 of 18

13 10. PROSPECTS The outlook for the domestic and global economies continues to improve. Singapore's economy has been forecast to grow between 3% to 5% in Against this backdrop, new home sales in 2004 are expected to increase from about 5,200 units sold in. This is indicative of firming residential prices. Meanwhile, the Group is preparing to launch the projects at Caribbean at Keppel Bay, Urbana, Wee Nam and The Tresor. Poor business sentiments and the uncertain economic climate, compounded by the USIraq war and the outbreak of SARS, resulted in office space demand being lackluster in. Consequently, rental rates and occupancies fell. Nevertheless, with limited new supply in 2004, demand for prime office space is expected to pick up with economic recovery and improved business confidence. Strong economic growth is likely to be sustained in China and other countries in the region such as Thailand and Vietnam. The Group will, therefore, continue to tap the growing demand for housing in these countries. One Park Avenue, the Group's maiden project in Shanghai, is now fullysold. The next project, 8 Park Avenue is being prepared for launch in 1Q At the same time, Villa Arcadia Srinakarin in Bangkok, and Villa Riviera in Ho Chi Minh City are targeted for launch in 1Q Barring unforeseen circumstances, and excluding exceptional gains or losses, the Group expects to achieve a similar level of profit in Keppel Land Limited, Page 13 of 18

14 11. DIVIDENDS (a) Current financial period reported on Directors are pleased to recommend a final dividend of 8% or 4 cents per share less tax (: final dividend of 7% or 3.5 cents per share less tax) in respect of the financial year ended 31 December for approval by shareholders at the next Annual General Meeting to be convened. Name of Dividend Final Special Total Dividend type Cash Cash Dividend rate 8% 8% Dividend in cents 4 cents 4 cents Par value of shares $0.50 $0.50 Tax rate 22% 22% (b) Corresponding period of the immediately preceding financial year Name of Dividend Final Special Total Dividend type Cash Cash Dividend rate 7% 7% Dividend in cents 3.5 cents 3.5 cents Par value of shares $0.50 $0.50 Tax rate 22% 22% (c) DATE PAYABLE The date will be announced later. (d) BOOKS CLOSURE DATES The dates will be announced later. 12. DIVIDEND STATEMENT (if no dividend has been declared / recommended) Not applicable. Keppel Land Limited, Page 14 of 18

15 13. SEGMENT ANALYSIS By business segment Group Figures Turnover Profit before Tax Attributable Profit Property investment 79, ,876 40,467 79,753 32,066 52,919 Property trading 563, , ,214 56, ,311 49,923 Others 35,855 44,352 (29,419) (6,965) (9,026) (8,583) Before exceptional items 678, , , , ,351 94,259 Exceptional items (25,800) (67,886) (25,800) (67,886) After exceptional items 678, , ,462 61, ,551 26,373 By geographical location Group Figures Turnover Profit before Tax Attributable Profit Singapore 339, ,725 80, ,188 86,458 91,694 Other countries 339, ,243 54,991 11,001 39,893 2,565 Before exceptional items 678, , , , ,351 94,259 Exceptional items (25,800) (67,886) (25,800) (67,886) After exceptional items 678, , ,462 61, ,551 26,373 Keppel Land Limited, Page 15 of 18

16 14. REVIEW OF SEGMENT PERFORMANCE (a) Turnover for property trading rose due to a higher progressive recognition of sales for One Park Avenue, Freesia Woods, Butterworth 8, The Edgewater, Amaranda Gardens and Botanic Cove. Revenue also came from the sale of three Cluny Hill land plots and the Norfolk Garden site. Turnover for property investment was lower due to a decline in rental rates and occupancies arising from the soft office market in, and to the disposal of Capital Square in November. (b) Attributable profit for property trading was higher due to contributions from One Park Avenue, Caribbean at Keppel Bay, and the sale of three Cluny Hill land plots. Adding to this were the writeback of provisions for the Norfolk Garden site and cost adjustments from completed projects which include Freesia Woods and The Edgewater. The lower attributable profit for property investment arose from the decline in turnover explained above. A lower tax expense due to the benefit of group tax relief and the writeback of deferred tax provision also helped to contribute to the higher Group attributable profit. (c) Profits from overseas contributed 32% of the Group attributable profit before exceptional items compared with about 3% a year ago. 15. FIRST HALF AND SECOND HALF YEAR RESULTS (a) First half and second half year results G R O U P +/() % Sales reported for first half year 298, , Operating profit after tax before deducting minority interests reported for first half year 47,522 46, Sales reported for second half year 380, , Operating profit after tax before deducting minority interests reported for second half year 50,508 (17,659) nm Keppel Land Limited, Page 16 of 18

17 (b) Interested person transactions Name of Interested Person Aggregate Value of all Interested Person Transactions during the Financial Year under Review (excluding Transactions less than $100,000 and Transactions conducted under Shareholders Mandate Pursuant to Rule 920). Aggregate Value of all Interested Person Transactions conducted under Shareholders Mandate Pursuant to Rule 920 of the SGX Listing Manual. Property transactions Keppel Corporation Limited Group : Rental Project management fees Property management fees Marketing commission 1,331 3, ,680 4,678 Other services and products Keppel Corporation Limited Group : Treasury interest income Treasury interest expense Management fees paid 2,291 (17,390) (3,627) 3,195 (31,641) (2,639) Other services (1,391) (5,074) Temasek Group (4,502) (4,220) Keppel Land Limited, Page 17 of 18

18 16. TOTAL ANNUAL DIVIDEND Total annual dividend amounted to () () Ordinary 22,149 19,347 Preference Total: 22,149 19,347 BY ORDER OF THE BOARD CHOO CHIN TECK / YEO KAH TIANG Joint Company Secretaries 28 January 2004 Keppel Land Limited, Page 18 of 18