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Great Eastern's FY2018 earnings underwhelm, company eyes Indonesia for growth, stock offers value

Thivyen Kathirrasan
Thivyen Kathirrasan2/25/2019 08:07 PM GMT+08  • 5 min read
Great Eastern's FY2018 earnings underwhelm, company eyes Indonesia for growth, stock offers value
SINGAPORE (Feb 25): Great Eastern Holdings, 88%-owned by Oversea-Chinese Banking Corp, reported a set of underwhelming FY2018 earnings compared with that in FY2017. Net profit fell 68% in 4QFY2018 to $136.9 million, from $426.8 million a year ago, mainly
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SINGAPORE (Feb 25): Great Eastern Holdings, 88%-owned by Oversea-Chinese Banking Corp, reported a set of underwhelming FY2018 earnings compared with that in FY2017. Net profit fell 68% in 4QFY2018 to $136.9 million, from $426.8 million a year ago, mainly due to lower non-operating profit and shareholders' funds profit. FY2018 earnings came in at $740.7 million, 29% lower y-o-y.

Operating profit rose 5% y-o-y to $171.6 million in 4QFY2018 and 4% y-o-y to $625.3 million for FY2018.

The decline in net profit was caused by unrealised fair value and mark-to-market losses in which shareholders’ funds investments fell 77% y-o-y. Great Eastern said: “4Q18 and FY2018 gain/loss on sale of investments and changes in fair value decreased 268% and 183% to a loss of $1,644.7 million and $2,630.8 million respectively, compared with the same periods last year due to unrealised losses in fair value through profit or loss (FVTPL) assets arising from unfavourable market conditions.” Equity and bond markets experienced significant volatility in the final quarter of 2018.

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