SC Global’s revenue plunges 56% to $88.7m in 4Q11

As the group’s development projects performed poorly during the fourth quarter of 2011.

According to a financial statement, the group’s revenue in the fourth quarter of 2011 declined 56% to $88.7 mil from $200.6 mil in the corresponding quarter of 2010.

Group Revenue included contributions from progressive revenue recognition of the Group’s development projects in Singapore, including Martin No. 38, and Seven Palms, Sentosa Cove. TOP was received for Martin No. 38 towards the end of the fourth quarter. In addition, revenue was also recognised from the sale of a new unit at The Marq on Paterson Hill.

Revenue was comparatively lower this year as 4Q 2010 included significant contributions from the progressive recognition of The Marq on Paterson Hill and Hilltops which were completed in the first half of 2011. Revenue contribution from the Group’s subsidiary in Australia under AVJennings Limited was also lower than last year due to weakened consumer sentiment.

Gross Profit during the quarter decreased by 72% to $25.3 mil from $89.2 mil. Gross margin for 4Q 2011 was lower at 29% as compared to 44% recorded in 4Q 2010.

Total operating expenses, including administrative expenses, were higher at $48.6 mil in 4Q 2011 as compared to $13.7 mil in 4Q 2010 mainly due to higher sales and promotion expenses, higher maintenance and service charges and an allowance for impairment of $25.0 mil relating to a development initiating at Ardmore Park.

Income tax expenses of $1.1 mil was written back in 4Q 2011 as compared to an expense of $16.5mil last year mainly due to pre-tax losses in 4Q 2011 and reversal of over provision of income tax expense of prior years.

Overall, Loss After Tax attributable to Equity holders was $18.6 mil as compared to a profit after tax of $45.3 mil in the corresponding quarter of 2010. The Net Loss was mainly due to lower revenue from the Group’s development projects during the fourth quarter of 2011, the absence of significant contribution from The Marq on Paterson Hill and Hilltops compared to 4Q 2010 as they neared their construction completion, and an allowance for impairment of $25.0 mil relating to a development.

Excluding this allowance, the Group would have reported a Net Profit after Tax of $4.6 mil.

Year ended 2011 vs Year ended 2010
Group Revenue for the full year increased 3% to $769.1 mil as compared to $743.2 mil last year. The increase was due mainly to new sales of units and higher revenue recognition from the Group’s Singapore development projects based on progress of construction, which more than offset the lower revenue contribution by AVJ, following the disposal of their Contract Building division in the third quarter of 2010.

The achievement of TOP for The Marq on Paterson Hill, Hilltops and Martin No. 38 in 2011 also contributed to the increase in revenue. The Group’s development project in Shenyang China, under Kairong, also contributed positively during the year.

Gross Profit rose by 24% to $294.0 mil during the year. Gross margin improved to 38% as compared to 32% last year.

Total operating expenses, including administrative and other operating expenses were higher at $117.4 mil this year as compared to $95.5 mil last year mainly due to an allowance for impairment of $25.0 mil relating to a development.

Overall, Profit After Tax attributable to Equity holders for the year was $132.2 mil, 42% higher than the restated Net Profit in the year 2010 of $92.9 mil, mainly due higher revenue recognition for the Group’s development projects and new sales of completed units. Earnings per share for the year increased to 31.61 cents from the restated 22.56 cents last year.