City Developments' net profit down 19.9% to $99.2m in Q1

Blame the absence of contributions from joint venture projects.

City Developments Limited posted a significant drop in net profit in Q1, ending the quarter with a 19.9% slump to $99.2m.

According to OCBC Investment Research, this is largely due to a range of factors, including the absence of contributions from two JV projects Bartley Ridge and Echelon, which achieved Temporary Occupancy Permit (TOP) in 2016.

Exchange losses, softer contributions from M&C and lower investment income from the realisation of an investment in Real Estate Capital Asia Partners also badgered overall bottom line for the group.

"We understand that the M&C’s numbers were affected by losses in its New York hotels, increased room supply, declining corporate demand in Singapore and an unfavourable FX impact from the decline of the pound Sterling," The brokerage firm said.

Here's more from OCBC Investment Research:

In terms of the topline, 1Q17 revenues grew 8.4% YoY to S$783.8m mainly due to healthier performances from the property development division given the progressive handover of units in Phase 1 of Suzhou Hong Leong Center (HLCC) and strong sales at Gramercy Park, partially offset by the absence of contributions from HAUS@SERANGOON GARDEN and Jewel @ Buangkok, which attained TOP last year.

We deem this set of results to be somewhat below our expectations and 1Q17 numbers now form only 13.6% of our full year forecast.