Keppel Land posts 21.6% plunge in Q4 net profit ahead of announcement

SINGAPORE — Keppel Land, which is speculated to soon be taken private by its parent company, yesterday sounded a cautious outlook for the rest of the year after fourth-quarter net profit plunged 21.6 per cent, saying it did not expect current cooling measures to be lifted any time soon.

Net profit for the quarter ended last month fell to S$444.5 million from S$567.3 million during the same period last year, Keppel Land said in a statement. For the full year, net profit fell 15.1 per cent to S$752.5 million.

“2015 is likely to be another challenging year as the economic conditions in our core markets of Singapore and China are not expected to improve significantly,” Keppel Land said. “The property cooling measures are unlikely to be lifted soon. However, we expect demand for well-located and well-planned residential projects … to hold up better.”

Keppel Land’s results yesterday showed that it sold 304 homes in Singapore last year, versus 370 units in 2013. Overseas, the group sold about 2,100 residential units during the year, of which about 1,900 were from China.

In all, the group’s total revenue for the fourth quarter increased by 39.5 per cent to S$705.4 million, as a result of higher revenue in its property trading and fund management segments.

Shares in Keppel Land and its parent, Keppel Corp, the world’s biggest maker of rigs, were halted from trading yesterday ahead of a corporate announcement, the two companies said in separate statements.

Some analysts cited market talk of Keppel Land being taken private by Keppel Corp as the reason for the trading halts.

There “could be many possibilities, including a privatisation of Keppel Land or a placement of shares by Keppel Corp,” said Mr Ryan Huang, a Singapore-based market strategist at IG.

“There is market speculation of a privatisation and you can see that reflected in the stock price (of Keppel Land),” said another analyst, who requested not to be named as he was not authorised to speak to the media.

A spokesperson for both Keppel Land and Keppel Corp declined to comment.

Keppel Land shares have risen 4.3 per cent this week and ended up 1.1 per cent at S$3.65 on Tuesday, taking its market value to S$5.6 billion.

In contrast, Keppel Corp’s shares have been on a downward spiral as investors cut exposure to the oil and gas sector due to the slump in oil prices. Its shares fell 1 per cent to close at S$8.10 on Tuesday, valuing the company at S$14.7 billion.

Keppel Corp will announce its results today. Agencies