City Developments Limited (CDL) has announced its financial results for the first half of fiscal year 2024, revealing a significant increase in Profit After Tax and Minority Interests (Patmi). The company reported a Patmi of $87.8 million, marking a 32% year-over-year growth. This improvement was largely attributed to gains from asset divestments, aligning with the group's capital recycling strategy.
Despite this profit increase, CDL's revenue for 1HFY2024 decreased to $1.6 billion, compared to $2.7 billion in the same period last year. The previous year's higher revenue included a substantial $1.0 billion contribution from the Piermont Grand executive condominium project, which was fully recognized upon receiving its Temporary Occupation Permit in January 2023.
Notably, CDL's investment properties and hotel operations segments experienced revenue growth of 21.3% and 10.8%, respectively, in 1H2024. The investment properties segment benefited from acquisitions made in 2023, including St Katharine Docks and various living sector assets. The hotel operations segment saw steady improvement, with increased Revenue Per Available Room (RevPAR) across most regions, further enhanced by adding new properties such as Sofitel Brisbane Central and Hilton Paris Opéra.
However, CDL's pre-tax profit for 1HFY2024 declined to $155.4 million from $179.5 million in the previous year. This decrease was primarily due to increased financing costs and reduced profits from the property development segment. The latter experienced lower profits year-over-year in 1HFY2024, mainly due to the timing of profit recognition and construction delays in certain projects.
Following several acquisitions and share buybacks, the group's net gearing ratio increased to 69% from 61% a year ago. In light of these results, CDL's board has declared a special interim dividend of 2 cents per share.
In terms of property sales, CDL maintained a strong performance, selling 588 residential units worth $1.2 billion in 1HFY2024, slightly surpassing the 508 units sold for $1.1 billion in the same period last year. The launch of Lumina Grand, a 512-unit executive condominium project, significantly contributed to these sales figures.
Looking ahead, CDL has plans to launch two new residential projects in the second half of 2024: the 366-unit Union Square Residences and the 348-unit Norwood Grand. Additionally, the company, in partnership with Mitsui Fudosan, secured a government land sale site on Zion Road, which they plan to develop into a mixed-use project featuring residential towers and retail space.
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