Apac Realty CLN announced that its FY2022 ended Dec 31, 2022 earnings has declined by 25% y-o-y to $26.6 million from $35.4 million a year ago.
This is as total revenue dropped by 4.7% to $705.0 million from $740.0 million in the same period last year.
Revenue from real estate brokerage fees and related services decreased by approximately 4.8% to $700.4 million from $735.4 million in FY2021, following a decrease in property transactions completed during the year.
The decrease in brokerage income is due to the following a decrease in resale and rental of properties of 7.1% y-o-y to $417.0 million and decrease in new home sales of 1.0% y-o-y to $278.3 million.
Other revenue increased by approximately 6.0% to $4.6 million, mainly due to the gain on disposal of associate during the year.
For the year 2022, the group notes that there was a decrease in the overall transaction volume in the private new and resale residential markets, and HDB resale market following the cooling measures rolled out by the authorities in December 2021.
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The recent Urban Redevelopment Authority (URA) data showed that prices of private residential property grew 0.4% in 4Q2022 and data from HDB indicated that overall prices for HDB has increased by 2.3% in the same period as well.
During 2022, developers sold 8,578 private residential units (including ECs), a decrease of 43.4% from 15,146 units sold in 2021. The private residential resale market recorded sales of 14,791 units, a decrease of 28.0% from 20,530 units sold in 2021. The HDB resale market reported a decline of 10.1% to 27,896 units in 2022 from 31,017 units in 2021.
The vacancy rate of completed private residential units has decreased from 6.0% as at Dec 31, 2021 to 5.5% as at Dec 31, 2022.
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Apart from the 16,961 unsold units (including ECs) with planning approval as at Dec 31, 2022, there is a potential supply of 9,300 units (including ECs) from Government Land Sales (GLS) sites that have not been granted planning approval yet.
Cash and cash equivalents at the end of December 2022 stood at $49.3 million.
For the FY2022 period, the board has proposed a final dividend of 2.75 cents per share, a decline from the 4.0 cents per share dished out in the same period last year.
“In the face of geo-political challenges, rising inflation and a fresh round of cooling measures introduced in September 2022, Singapore residential property market remained relatively robust in FY2022. Whilst the September 2022 cooling measures weighed on transaction volumes in 2H2022, home prices remained buoyant. This was largely driven by strong demand from local home buyers and interest from foreign investors amidst a backdrop of limited supply,” says Marcus Chu, CEO of Apac Realty.
Adding on, Chu notes that the group made strong headway in its regional growth expansion strategy in January by increasing its interest in ERA Vietnam to 60%. “We are now better positioned to participate in the long-term growth of Vietnam’s residential property market and one of the fastest growing economies in the region. We are working on realising synergies and opportunities with ERA Vietnam for the group, which will accrete value for our shareholders over the long-term,” adds Chu.
Moving forward, the group will continue to focus on its regional presence in Asean and has acquired controlling stakes in ERA Indonesia and ERA Vietnam, where the group expects to be more involved going forward.
Shares in Apac Realty closed at 61 cents on Feb 23.
