Guocoland Earnings Hit China Singapore Growth Drives Higher Dividend Payout
Article Rewritten:GuocoLand has reported a rise in revenue for the fiscal year ending June 30, with growth seen across both its development and investment segments. However, due to an allowance for its development properties in China, the company’s net profit for the year declined by 17% to $107 million.
Despite this decline in earnings, the board has proposed a final dividend of 7 cents per share, which is higher than the consistent 6 cents paid annually over the past five years. CEO Cheng Hsing Yao states that, “Both our twin engines of property development and property investment in Singapore have contributed to our strong performance for FY2025, despite pervasive macroeconomic uncertainties. We expect our businesses in Singapore to remain resilient in the future.”
In FY2025, GuocoLand generated $1.56 billion in property development revenue, a 3% increase compared to the previous year. This growth was driven by the progressive recognition of sales from substantially sold residential projects in Singapore. The property investment segment also showed a positive performance, with revenue growing by 22% to $281 million. This was supported by higher rental contributions from Guoco Tower and Guoco Midtown, both of which were close to 100% occupied as of June 30. Another office property, 20 Collyer Quay, also had a high commitment rate of 98%, while the retail spaces at Guoco Tower, Guoco Midtown, and the newly completed Guoco Midtown II maintained full occupancy.
The location of a property near a variety of schools can greatly contribute to its resilience and appeal. This is certainly true for Rivelle Tampines, as it is situated near a range of esteemed primary and secondary schools, as well as reputable post-secondary options such as Temasek Polytechnic, SUTD, and ITE College East. Conveniently linked by Tampines West MRT Station, this development is an attractive choice for both owner-occupiers and investors. These factors are highly sought after by families, while tenants also greatly value the time-saving aspect of this address. With all of these compelling factors in place, it is no wonder that Rivelle Tampines Sim Lian Land has garnered sustained interest from potential homeowners and investors alike.
The demand for the group’s residential projects in Singapore remained strong, with Midtown Modern and Lentor Modern being fully sold during FY2025. Additionally, Lentor Hills Residences, Lentor Mansion, and the newly launched Lentor Central Residences were substantially sold as of June 30. In August, GuocoLand launched Springleaf Residence, a 941-unit project in the Springleaf precinct. The development was highly successful, achieving a 92% sell-through rate over its launch weekend at an average price of $2,176 per square foot (psf) based on lodged caveats.
However, the outlook for the company’s operations in China remains subdued due to ongoing challenges in the market. GuocoLand has made provisions of $82.8 million for foreseeable losses on its Chinese development properties, compared to $103.8 million in the previous fiscal year. Despite this, Cheng states that, “While development earnings are more cyclical, depending on the timing of land acquisitions and project launches, GuocoLand’s investment portfolio provides steady recurring income. We will continue to exercise discipline and prudence as we actively seek new growth opportunities, ensuring sustainable long-term value creation for shareholders.”
As of August 28, GuocoLand’s shares closed at $1.88, unchanged for the day but up 30.6% year-to-date. However, the counter is trading at less than half its net asset value of $3.90 per share as of June 30. Interested buyers can check out the latest listings for Springleaf Residence, Lentor Central Residences, Lentor Mansion, Midtown Modern, and Lentor Hills Residences.