PROPERTY group Apac Realty, which operates under the ERA brand, posted an 18.7 per cent drop in net profit to S$4.1 million for the six months ended Jun 30, down from S$5 million in the year-ago period.
This was mainly due to cost of services outpacing revenue growth in the period.
Earnings per share for H1 stood at 1.15 Singapore cents, down from 1.41 Singapore cents previously.
Total revenue rose 2.1 per cent to S$265.2 million in the period, while cost of services gained 3.3 per cent to S$240.7 million.
In particular, the group saw a 21 per cent fall in new home sales to S$57.9 million in H1, from S$73.3 million previously.
“The rate of increase in cost of services is higher than the rate of increase in revenue because the margins from resale and rental transactions are lower than those from new home sales transactions,” Apac Realty said in a bourse filing on Thursday (Aug 8).
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An interim dividend of 0.9 Singapore cent per share was declared, compared with 1.1 Singapore cents per share in the year-ago period.
The group saw a “historic low” in new project launches since 2004, with 1,938 units launched during the period.
“The Singapore property market is continuing to exhibit signs of moderation in the midst of strong headwinds from cooling measures, slower economic sentiment, high interest rates and fewer new home launches,” said Apac Realty chief executive Marcus Chu.
“For the next five months of the year, we expect homebuying momentum to pick up, on the back of 14 upcoming new home projects comprising more than 6,700 new homes,” he added.
Shares of Apac Realty closed S$0.005 or 1.3 per cent lower at S$0.38 on Thursday, before the earnings announcement.
