Metro Holdings Reports Profit 146 Mil Fy2024
During the financial results briefing on May 24, Metro Holdings Limited (Metro Group) announced a decrease in net profit after tax for FY2024, reaching $14.6 million. This marks a significant 42% decline from the previous year’s net profit of $25.3 million.
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According to the Metro Group chairman, Winston Choo, this decrease in profit is due to various market challenges such as the prevailing high interest rate environment and the difficult China property market. In particular, the group’s borrowing costs increased by $4.1 million, and $23 million in asset value was lost through the evaluation of their investment properties.
The property division of the group reported a 21.1% decrease in revenue as compared to the previous year. This is mainly due to a decrease in sales volume from their residential properties in Jakarta. Additionally, the group faced a loss of $8.7 million from their investments in properties located in Mainland China, the UK, and Australia.
The rental revenue of the property division was also affected, with a decrease in revenue from GIE Tower in Guangzhou, dropping from $6.4 million in FY2023 to $5.5 million in FY2024. Furthermore, revenue from their property at 5 Chancery Land in the UK ceased in May 2023 due to ongoing enhancement works being carried out.
The challenging property market in Mainland China also caused a loss of $30.8 million through the group’s stake in Top Spring International Holdings (Top Spring).
On the other hand, the retail division of the group also reported a decrease in profit of $4.1 million, primarily because of lower gross margins and increased operating costs.
However, the group’s overall losses were partially offset by the recognition of negative goodwill value from the acquisition of an additional 6% stake in Top Spring in January. This resulted in a profit of $60.3 million for Metro Group.
Last year, Metro Group expanded its portfolio by acquiring a 20% stake in VisionCrest Commercial, a Grade-A office building located along Penang Road in the prime Orchard Road area. The property, which has a 11-storey freehold, has a net lettable area of 148,854 sq ft, with an occupancy rate of 89.5% and a weighted average lease expiry of 2.2 years as of March.
However, the overall occupancy rate for the group’s other four investment properties, including GIE Tower in Guangzhou, Metro City, Metro Tower in Shanghai, and Asia Green in Singapore, decreased to 84.5% as of March, from 89.8% in March 2023.