Shareholders of Sinyi Realty Inc (信義房屋), the nation’s only listed property broker, yesterday approved a generous dividend payment even though earnings slowed in the first quarter and may remain lackluster going forward amid an unfavorable environment.
Shareholders gave the go-ahead to a NT$4.8 per share dividend — NT$2.6 in cash and an extra NT$2.2 in stock — based on last year’s net income of NT$2.48 billion (US$82.36 million).
That accounts for 97.56 percent of last year’s profit when the company posted record high revenue of NT$12.09 billion, up 38.19 percent from the previous year, as the housing market emerged from disruptions related to the special sales levy and the mandatory disclosure of transaction details, Sinyi Realty chairman Chou Chun-chi (周俊吉) said.
Housing transactions increased 12.78 percent last year from 2012 as the broker added 10 percent more offices, general manager Jeremy Shive (薛健平) said.
Shive attributed Sinyi’s above-average performance to refined operations and cost efficiencies.
Looking ahead, the company aims to increase its market share to 30 percent, from 7 percent, making it less vulnerable to external shocks, despite its top ranking among its peers, Shive said.
To that end, the company plans to add 20 more offices this year, increasing the total number to 437 from 417, Shive said.
Sinyi saw its earnings retreat sharply in the first quarter, with net income down by almost 50 percent to NT$239 million from the same period last year, or earnings per share of NT$0.48, company data showed.
Consolidated revenue dropped 13.65 percent year-on-year to N$2.21 billion, while gross margin dropped 6 percentage points to 26.5 percent.
Softening sales in both the presale and existing home markets accounted for the slowdown, Sinyi said.
The trend may persist into the second quarter as the government’s plans to reform property taxes and November’s seven-in-one elections weigh on the market, Chou said.
Election candidates are basing their campaigns on curbing soaring house prices in their districts, Chou said.
The Ministry of Finance is studying the feasibility of reforming property taxes so they better reflect market rates rather than the conservative government-assessed values upon which current taxes are currently levied.
In related news, Farglory Land Development Co (遠雄建設) said it won an urban regeneration contract in southern Greater Tainan valued at NT$100 billion. The government-sponsored project is to build 10 residential buildings on a plot of land measuring 8,575.27 ping (28,348m2), the developer said in a stock exhange filing.
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