Far East Orchard (O10) Q1 2024 TU earnings summary

Executive summary

• 1Q FY2024 profit after tax rose 54.8% YoY to S$6.5 million, supported by PBSA growth and stable Hospitality contributions.

• April’s acquisition of a 49% stake in Homes For Students and ongoing PBSA development support the strategy to expand recurring lodging income.

Financial highlights

• Revenue was S$50.9 million, up 10.4% YoY; operating profit was S$18.1 million, up 17.5% YoY.

• Profit after tax was S$6.5 million versus S$4.2 million; profit attributable to equity holders was S$6.9 million versus S$4.7 million.

Outlook and guidance

• IMF forecast global growth of 3.2% in 2024, matching 2023; geopolitical tensions could trigger supply disruptions and price spikes affecting rental and occupancy rates.

• Lodging platform strategy targets recurring income, with active asset management, asset recycling, and reinvestment in higher-yielding opportunities.

• Strategic priorities include scaling Hospitality and PBSA, exploring capital partnerships, and pursuing new recurring income streams or lodging-platform acquisitions.