REAL estate agency PropNex reported a 14.9 per cent year-on-year fall in net profit for its second half ended Dec 31 to S$21.9 million, from S$25.8 million.
Its revenue was down 7.7 per cent at S$437.4 million from S$473.8 million in the previous corresponding period, based on the company’s financial results released on Tuesday (Feb 25).
The lower revenue for the period was driven mainly by a decrease in commission income from project marketing services of S$34.5 million, resulting from fewer transactions being completed for project marketing in H2 FY2024, PropNex said.
Its earnings per share stood at S$0.0296 for the half year, down from S$0.0348 previously.
The board proposed a final dividend of S$0.03 per share, alongside a special dividend of S$0.025 per share, to be paid on May 8 following books closure on Apr 28. This brings the total dividend for FY2024 to S$0.0775 per share, reflecting a payout ratio of 140.1 per cent of its net attributable profit with an 8.2 per cent dividend yield based on the counter’s share price as at Dec 31, 2024, PropNex said.
For the full year, its net profit was down 14.4 per cent at S$40.9 million from S$47.8 million in the year-ago period. Revenue retreated on the year by 6.6 per cent to S$783 million from S$838.1 million. EPS was S$0.0553 compared with S$0.0646 previously.
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The lower revenue for the year was primarily driven by a 23.4 per cent year-on-year decrease in commission income from project marketing services to S$185.6 million, as fewer project marketing transactions were completed in FY2024, PropNex said.
Commission income from agency services rose slightly to S$591.6 million.
Outlook
While market sentiment was muted for the better part of 2024, the fourth quarter of FY2024 witnessed a “significant rebound in private new home launches”, the company said in a statement.
Nearly half the agency’s total private new home transactions for 2024 occurred during this period, noted Ismail Gafoor, executive chairman and chief executive officer of PropNex.
He said: “The surge in new project launches made Q4 FY2024 an exceptionally strong quarter for PropNex… The financial impact of these transactions will materialise in H1 FY2025, which will put us on track to deliver a strong performance in FY2025, barring unforeseen circumstances.”
The group expects a positive market outlook in 2025 and forecasts a 3 to 4 per cent rise in overall private home prices for the year.
The private resale market is set to remain lively with demand fuelled by “the persistent price gap between new and non-landed resale properties, a preference for larger, move-in-ready homes, and the impact of fewer new supply completions”, the company said.
The Housing and Development Board resale market is primed for a projected 5 to 7 per cent price growth with demand driven by fewer five-year minimum occupation period flats entering the market, as well as sustained interest from buyers with urgent housing needs, unsuccessful applicants of Build-To-Order flats and budget-conscious families, it added.
Shares of PropNex closed flat on Monday at S$1.13.
