Mon, Mar 19, 2018 - Page 16 News List

Huaku looking to next year’s presale projects

By Chen Cheng-hui  /  Staff reporter

Property developer Huaku Development Co (華固建設) on Wednesday last week released financial results for last year, showing that both sales and earnings fell from the previous year.

The Taipei-based company posted net income of NT$2.16 billion (US$73.89 million) with earnings per share (EPS) of NT$7.87, compared with the previous year’s net income of NT$2.41 billion with EPS of NT$8.73.

Operating profit fell 18.5 percent year-on-year to NT$2.28 billion and revenue decreased 11.9 percent to NT$10.38 billion, while gross margin increased 0.03 percentage points to 30.7 percent, the firm said.

EXISTING PROJECTS

Looking ahead, Huaku said it aims to sell NT$10 billion worth of residential properties this year, as it continues to promote existing projects including “New World” in the Jinmei (景美) area of Taipei’s Wenshan District (文山), “Sky Garden” in the Tianmu (天母) area of the city’s Shilin District (士林), and “Huacheng” in New Taipei City’s Sindian District (新店).

However, the number is less than the NT$14 billion worth of properties that the company sold last year.

In the first two months of this year, Huaku’s aggregate sales reached NT$508 million, up 38.5 percent from the same period last year, thanks to contributions from the “New World,” “Sky Garden” and “Huacheng” projects.

However, due to not completing any new projects this year, total sales for this year are forecast to decline 34.66 percent to NT$6.78 billion and net profit to drop 34.22 percent to NT$1.43 billion, with EPS of NT$5.18, First Capital Management Inc (第一金投顧) said in a note on Thursday.

“Because of the company is lacking new project contributions and is focusing on selling existing homes, we anticipate its operational momentum to remain relatively flat this year,” First Capital analyst Mandy Cheng (鄭亦涵) said in the note.

NEW PROJECTS

Cheng said Huaku could see better financial results next year, when it is set to generate revenue from the completion of several presale projects.

The upcoming projects include the NT$4 billion “Sweet Garden” in New Taipei’s Tucheng District (土城), the NT$8 billion “Your Majesty” in Taipei’s Songshan District (松山) and the NT$5 billion “Le Mout” in the capital’s Zhongshan District (中山).

These presale projects have thus far shown healthy sales momentum, with sell-through ratios of more than 70 percent, Cheng said.

Huaku’s board on Wednesday approved to offer shareholders a cash dividend of NT$5.2 per common share, which represents an attractive yield of 7.11 percent based on Friday’s closing price of NT$73.1.

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