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Keppel Land's full-year net profit up 5.7% on-year to S$885.9m

Keppel Land has achieved higher a net profit in 2013 despite the slew of government cooling measures in the property market.

SINGAPORE: Keppel Land has achieved a higher net profit in 2013 despite the slew of government cooling measures in the property market.

The company attributes this to its overseas investments which are paying off.

Keppel Land's full-year net profit for the period ended December 31 rose 5.7 per cent on-year to S$885.9 million.

This is on the back of record revenue of S$1.5 billion, a 55.6 per cent increase.

In the fourth quarter, net profit was up 7.2 per cent from the same period last year to S$505.7 million.

Still, the absence of bumper profit of S$160 million from Reflections at Keppel Bay in 2012 has caused net profit in the property trading segment to decline 16 per cent to S$271.8 million.

Due to loan curbs and cooling measures, Keppel Land sold 13 per cent less new homes in Singapore in 2013 than in 2012.

Its sales of 370 units in Singapore last year mostly came from new projects like The Glades at Tanah Merah and Corals at Keppel Bay.

However, improved contributions from non-residential segments like Keppel REIT and Marina Bay Financial Tower 3, as well as Sedona Hotel Yangon and Bintan Resorts helped boost overall net profit.

Ang Wee Gee, CEO of Keppel Land, said: "In fact, our exposure to the residential market here in Singapore here is not quite high. It is only about a fifth of our assets so we are quite comfortable with that."

Mr Ang added the company will continue to invest in key markets when the opportunity arises.

Looking ahead, Keppel Land said it will continue to diversify its business out of Singapore in China, Indonesia and Vietnam, as well as explore more opportunities in Myanmar and Sri Lanka.

Some analysts say the latest earnings are in line with their expectations.

Wilson Liew, an analyst at Maybank-Kim Eng, explained: "Keppel Land's results came in within our expectations. I think what is more important is that from an operational point of view, they reported that home sales in China are still very healthy, and we hope to see that sustained in 2014."

Liew added: "Keppel Land is our top picks. We see deep value both on price to book basis as well as discount to our own RNAV."

Keppel Land has proposed a dividend of 13 cents per share for the year – which translates to a four per cent dividend yield based on Wednesday's closing share price of S$3.26.

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