Propnex Reports 1Hfy2024 Earnings 19 Mil Down 138 Y O Y
Singapore’s largest property agency, PropNex, has announced a profit of $19 million for the first half of its fiscal year ending June 30th, 2024, a 13.8% decrease from the $22.1 million earned in the same period last year. The decline in earnings is a result of a decrease in overall revenue during the period. The group’s total revenue for the first half of 2024 was reported to be $345.6 million, a 5.1% decrease from the previous year.
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The main driver of the lower revenue was a decline in commission income from project marketing services. This segment saw a decline of 19.6% year-on-year, with revenue dropping to $91.3 million. PropNex attributes this to a decrease in new launches in the private residential market. In the first half of 2024, developers sold 1,889 new homes, a significant decrease of 44.2% compared to the same period in the previous year.
On the other hand, the private resale market saw an increase in activity during the first half of the year. The number of transactions for private resale homes rose by 16% to 6,491 units, while the HDB resale market was also resilient, with transactions increasing by 6.9% to 14,420 flats.
This increase in secondary market transactions helped boost PropNex’s commission income from real estate agency services, which saw a growth of 1.3% year-on-year to reach $251.9 million.
Ismail Gafoor, the executive chairman and CEO of PropNex, notes that the private resale market accounted for 70.9% of all private residential transactions in the first half of 2024. He expects this segment to continue driving private home sales for the rest of the year, with a projected 13,000 to 14,000 resale private homes expected to be transacted in 2024.
As for dividends, PropNex has proposed an interim cash dividend of 2.25 cents per share for the first half of the year.
For the future, the group has adjusted its forecast for private new home sales in 2024 to account for the lower number of new launches and the continued impact of cooling measures implemented last year. It now expects between 5,500 and 6,000 private new home sales, down from its previous forecast of 6,000 to 6,500. PropNex also predicts a 4% to 5% increase in private home prices for the year, slightly lower than the 6.8% growth seen in 2023.
Meanwhile, the HDB resale market is expected to remain strong, with PropNex predicting a range of 28,000 to 29,000 units sold this year, higher than the 26,735 units sold in 2023.