PROPERTY firm Keppel Land will launch a new 620-unit Sengkang project by the end of this year, despite a cooling market.
The announcement yesterday came on the day the company said its second-quarter net profit fell 65 per cent, largely due to the adoption of a new accounting policy.
Earnings were $50.5 million for the three months up to June 30, down from $143.8 million a year earlier, while revenue was down 67 per cent to $104 million.
The accounting change requires developers to recognise revenue and profit only on completion of certain projects. In the past, developers had smoothed out their revenue streams from projects, progressively recognising income over the contract period as certain milestones were met.
Keppel also faced slower home sales in China after a raft of cooling measures. It sold 400 homes in China in the first half of this year, well under the 1,200 sold in the corresponding period last year, but the firm said it does not plan to cut prices.
Group chief executive Kevin Wong said while cooling measures here and the impending supply from government land sales dampened Singapore's private home sales in the first six months of the year, property in selected suburban regions and near MRT stations will still attract interest.
Healthy economic growth, a buoyant job market, ample liquidity, a low interest rate environment and the sustained influx of foreigners will also provide support for the residential market here, said chief financial officer Lim Kei Hin.
The company sold 160 homes here in the first half of the year, with a total value of $245 million.
Mr Wong said future investments - whether here or overseas, commercial or residential - will simply depend on opportunities. 'In China, we started doing some commercial developments. In the past, we had not gone in in any big way; we focused on residential because that was a market that we thought had the most profits.
'And of course, now with all these cooling measures, there are locations and opportunities where commercial markets will become attractive.'
Net profit for the six months fell 34 per cent to $134 million from a year earlier. Revenue rose 9 per cent to $462 million.
Earnings per share for the half-year dipped to 9.1 cents from 14 cents last year, while net asset value per share was $2.72 as of June 30, down from $2.85 as of Dec 31.