Capitaland Investments Net Profit Fell 6 Y O Y 1Hfy2024
CapitaLand Investment has reported a 6% year-on-year decline in net profit after tax and minority interests (Patmi) to $331 million for the first half of fiscal year 2024, which ended on June 30. Operating net profit after tax and minority interests (Patmi), which excludes gains and losses from divestments, revaluations, and impairments, also saw a decrease of 14% year-on-year, falling to $296 million. The decline in the company’s real estate investment business (REIB), caused by higher interest expenses and unfavorable foreign exchange rates, offset the strong performance of its fee-related business (FRB).
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In spite of these challenges, CapitaLand Investment managed to achieve a 1% year-on-year growth in revenue, reaching $1.365 billion. This was largely driven by the 8% increase in FRB revenue, which totaled $561 million. The improvement in asset performance and contribution from new management contracts in the lodging and commercial management businesses were key factors in this growth. Additionally, the fund management business also contributed to the revenue increase due to higher event-driven fees. However, REIB revenue saw a decline, falling to $911 million mainly due to the absence of contributions from properties divested in China, Australia, France, India, and Singapore, as well as a decrease in corporate leasing demand in the USA.
The strong performance of FRB was evident in its contribution to operating Patmi, which grew to 63% from 49% in the same period last year. As part of its asset-light transition and diversification strategy, CapitaLand Investment made significant progress in unlocking capital recycling of $1.7 billion, which will be reinvested for future growth.
During the first half, CapitaLand Investment successfully monetized $1.7 billion and saw a 6% increase in lodging management revenue per available unit (RevPAU). The company also added new growth engines, such as the multi-year partnership between The Ascott Limited and Chelsea Football Club. The commercial management business also saw a 22% growth in fee-income-related revenue, largely driven by improved asset performance and a restructuring of management fees.
In line with its policy of only paying a final dividend, the company did not declare any interim dividends.
