PropNex (OYY) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2024 declined by 5.1% year-over-year to $345.6 million, mainly due to lower commission income from project marketing services as a result of fewer completed transactions and market cooling measures.

• Net profit attributable to owners decreased 13.8% to $19.0 million, reflecting the revenue decline and lower reversal of impairment losses.

• Gross profit margin remained stable, with cost of services rendered decreasing in line with revenue.

• Interim cash dividend of 2.25 cents per share declared, with an 87.6% payout ratio, payable 10 September 2024.

• Private resale market drove performance, offsetting declines in new home sales.

Financial highlights

• Revenue: $345.6 million (down 5.1% year-over-year).

• Net profit attributable to owners: $19.0 million (down 13.8% year-over-year).

• Basic and diluted EPS: 2.57 cents (down from 2.98 cents year-over-year).

• Gross profit: $33.4 million (down 6.5% year-over-year).

• Commission income from project marketing dropped 19.6% year-over-year; agency services income rose 1.3%.

Outlook and guidance

• Private new home sales projection for 2024 revised down to 5,500–6,000 units, but several sizable launches in 2H2024 could boost sales.

• Overall private home prices expected to rise 4–5% in 2024, moderating from 6.8% in 2023.

• HDB resale demand expected to remain resilient, with annual volume projected at 28,000–29,000 units.

• The group remains cautiously optimistic for 2H2024, supported by a strong salesforce, upcoming project launches, stabilising prices, and potential easing of borrowing costs.