Ho Bee’s revenue plunges 43% to S$56m in 3Q11

As some of its major projects in Sentosa remain 56%-74% unsold.

In total, CIMB estimates Ho Bee has 400-450 unsold units on its books.

Here’s more from CIMB:

Weak sales starting to show
While 3Q is consistent with our expectation (below consensus), weak development sales have become more apparent. Some major projects in Sentosa have been completed, but remain largely unsold. Earnings this quarter were propped up by divestment gains.

Development sales plunged yoy
Revenue in 3Q11 fell 43% yoy as development sales recognition began to decline considerably. Sentosa projects in Seascape and Turquoise have been completed but remain 56-74% unsold. Our last check with management suggests these units may be released for rent. The Pinnacle, its last site in Sentosa acquired at the top of the market, has yet to be launched. In total, we estimate Hobee has 400-450 unsold units on its books.

Propped up by commercial properties
3Q11 was propped by a S$13m divestment gain from the sale of three floors in Samsung Hub. By mid-2012, proceeds from the sale of One Pemimpin (115 units of industrial space) should also show up. Hobee has been rationalising its investment property portfolio, following its acquisition of 1.2msf of office space at one-north.

Lacking catalysts
Net gearing remained low at 0.24x, giving Hobee the debt capacity to fund capex. It recently added Zhuhai (20% stake) to its China landbank in a JV with Yanlord and Shanghai You You. Valuations are also undemanding at 0.6x P/BV. However, price catalysts are lacking, in our view, with its exposure to the high-end market an overhang. A more protracted lull in demand for China properties and Singapore office space will add to valuation pressures.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia