FINANCIAL REVIEW For FY 2024, the Group reported a net profit after tax and non-controlling interest (PATMI) of $201.3 million (FY 2023: $317.3 million) due to the timing of profit recognition from its property development segment and elevated financing costs. Revenue decreased by 33.8% to $3.3 billion (FY 2023: $4.9 billion) due to lower contributions from the property development segment and the absence of substantial gains recorded in FY 2023 arising from Piermont Grand’s contribution when it obtained its Temporary Occupation Permit (TOP), as well as the sale of the freehold land site in Shirokane, Tokyo. The investment properties segment saw an 11.1% revenue increase, driven by acquisitions and organic growth from assets such as Republic Plaza and Jungceylon Shopping Center in Phuket, which reopened in June 2024. Strategic acquisitions completed in 2023 and 2024, including St Katharine Docks in London and several living sector assets in Tokyo and Osaka, also contributed to the revenue boost during the year. The hotel operations segment posted an 8.2% increase in revenue, fuelled by the addition of new hotels including the Sofitel Brisbane Central hotel in December 2023 and the Hilton Paris Opéra hotel in May 2024, along with the official opening of the M Social Phuket in June 2024. The Group’s global Revenue Per Available Room (RevPAR) rose 2.6% in FY 2024, continuing the positive trend from the previous year’s post-pandemic tourism recovery. Pre-tax profit fell to $374.0 million (FY 2023: $472.6 million) mainly due to lower profits from the property development segment, which was impacted by the timing of profit recognition, higher financing costs and construction delays for certain projects. In contrast, in FY 2023, substantial gains came from Piermont Grand, the sale of the land site in Tokyo and other Singapore projects that obtained TOP, such as Amber Park and Boulevard 88. The investment properties segment reported a pre-tax profit for FY 2024 due to divestment gains, including the sale of strata units in Citilink Warehouse Complex, Cititech Industrial Building and Fortune Centre, along with the sale of its entire equity stake in Cideco Pte. Ltd., which holds an industrial property, Cideco Industrial Complex, in Singapore. The hotel operations segment reported a pre-tax profit for 2024 and positive EBITDA for all regions. The Group’s interest expense increased 21% to $588.7 million (FY 2023: $485.8 million) for FY 2024 which eroded profit. Property Development Revenue decreased by $1.85 billion to $939.4 million (FY 2023: $2.79 billion) for FY 2024. Correspondingly, pre-tax profit decreased by $321.0 million to $18.5 million (FY 2023: $339.5 million) for the year. Projects that contributed to both revenue and profit in FY 2024 included Irwell Hill Residences, Hong Leong Technology Park Shenzhen, Hongqiao Royal Lake in Shanghai, The Myst, Norwood Grand, Sunshine Plaza, Teddington Riverside in the United Kingdom, as well as New Zealand land sales. In accordance with the Group’s policy of equity accounting for the results of its joint ventures, whilst revenue from joint venture developments such as Kassia, CanningHill Piers, Tembusu Grand, Penrose and Piccadilly Grand had not been consolidated into the Group’s total revenue, the Group’s share of profit arising from these joint venture developments had been included in pre-tax profit. The decrease in revenue for FY 2024 was due to an absence of contribution from the sale of the land site at Shirokane and Amber Park, partially offset by higher contributions from The Myst, Hong Leong Tech Park Shenzhen and maiden revenue recognition from Norwood Grand and Union Square Residences. Revenue for FY 2023 was also underpinned by full revenue recognition from EC project Piermont Grand, which obtained TOP in 1H 2023. The decrease in pre-tax profit for FY 2024 was in-line with the lower revenue achieved, partially mitigated by lower net allowance for foreseeable losses made on development properties. Included in FY 2023 was a negative goodwill of $38.8 million recognised on the acquisition of Summervale Properties Pte Ltd. Investment Properties Revenue for this segment increased by $50.1 million to $499.6 million (FY 2023: $449.5 million) for FY 2024. This segment reported a pre-tax profit of $146.1 million (FY 2023: pre-tax loss of $40.8 million) for FY 2024. The increase in revenue for FY 2024 was due to contributions from additions to the living sector portfolio including five Private Rented Sector (PRS) properties in Japan and the re-opening of Jungceylon Shopping Center following the completion of its asset enhancement works. Full year contribution from St Katharine Docks acquired in 1H 2023 also bolstered the performance for FY 2024 revenue. Pre-tax profits were registered for FY 2024 due to much higher divestment gains recorded in the current year, which partially mitigated the increase in interest expense with higher bank borrowings and depreciation expenses. In 2024, the Group recognised gains from the disposal of the Group’s entire equity stake in Cideco Pte. Ltd., which owns Cideco Industrial Complex, and strata units in Citilink Warehouse Complex, Cititech Industrial Building and Fortune Centre, totalling $230.5 million (FY 2023: $29.6 million) for FY 2024. The divestment gains in 2023 relate largely to the disposal of a small land plot at Tanglin Shopping Centre in 1H 2023 and strata units in Citilink Warehouse Complex. ANNUAL REPORT 2024 BUSINESS OVERVIEW 59
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