Positioning for the Future | 07
Steady Financial Performance
In a year which saw much geo-political uncertainties
and market headwinds, CapitaLand delivered a set of
resilient and healthy mnancial results. For the year ended
31 December 2014, CapitaLand achieved S$3.9 billion of
total revenue and S$2.4 billion of earnings before interest
and tax (EBIT) from our continuing operations. Total net
promt after tax and minority interests (PATMI) increased
38% to reach S$1.2 billion
1
. Renecting the strength of our
underlying businesses, operating PATMI grew 40% to
reach S$705.3 million
2
and earnings per share (EPS) was
27.3 Singapore cents, up 39%. CapitaLand’s share price
outperformed the market, growing from S$3.03 to end
the year at S$3.31. Including total paid out dividends of
8.0 Singapore cents per share, the total shareholders
returns in 2014 was 11.9%.
Proactive
Capital
Management
Supports
Sustainable Growth
CapitaLand ended the year with ample mnancial capacity
of S$2.7 billion cash and S$5.0 billion available undrawn
facilities. We maintained a net debt to equity ratio of
0.57 times, and strong interest cover and interest service
ratios of 7.2 times and 4.6 times respectively. Net debt
to total assets
3
remained healthy at 0.32 times. As part
of our active capital management strategy, CapitaLand
on a consolidated basis raised an aggregate of about
S$1.9 billion from the capital markets in 2014. As at
end-2014, average debt maturity promle remained at
3.3 years. To manage volatility of interest rates, 75% of
the Group’s borrowings were mxed-rate.
Strong and Resilient Core Businesses Drive
Recurring Income
Over the past two years, CapitaLand has further built up
a well-balanced portfolio that delivers steady recurring
income. Our portfolio of total assets (by effective stake
excluding treasury cash) has grown 24% since 2012
to reach S$33.1 billion by the end of 2014. Out of this,
74% were investment properties made up of commercial
and integrated developments (30%), shopping malls
(29%) and serviced residences (13%) which contributed
S$1.1 billion of recurring EBIT, representing 61% of
2014’s total operating EBIT of S$1.8 billion. The remaining
26% of our portfolio comprised residential and strata
ofmce properties developed for sale, which contributed
operating EBIT of S$678.9 million in the same period.
In line with CapitaLand’s policy to grow core dividend on
a sustainable basis, the Board is pleased to propose an
increased mnal ordinary dividend of 9.0 Singapore cents
a share for Financial Year 2014.
Leading the Change
Focusing on Integrated Projects
With rapid urbanisation, governments and city
planners are placing greater emphasis on sustainable
development, turning to integrated developments
which optimise space and resource efmciencies.
What makes a good integrated development is having an
optimal mix of quality retail, hospitality, commercial and
residential spaces, all seamlessly integrated to provide
the day-to-day convenience and comfort for people
to live, work and spend time in. Thus, well-designed,
well-built and well-managed projects located around
key regional centres and transport hubs have done well
and are expected to stay relevant over time.
CapitaLand is in a position of strength to capitalise on
these trends. We have established meaningful scale
and track record in developing and managing shopping
malls, serviced residences, ofmces and homes in
Singapore and China. As ONE CapitaLand, we are
determined to harness our collective competencies to
realise the right opportunities in integrated projects.
Building Scale in Singapore and China
Our geographical strategy is clear – focus on Singapore
and the gateway city clusters of China to build meaningful
scale. Altogether, Singapore and China accounted
for 83% of the Group’s total assets (excluding treasury
cash) and 84% of the Group EBIT. Singapore makes up
S$17.8 billion or 41% of the Group’s total assets,
providing a steady springboard for our growth pursuits,
while China makes up S$18.3 billion or 42%. Other Asia
4
,
as well as Europe & Others
5
stood at S$4.7 billion (11%)
and S$2.5 billion (6%) respectively.
China’s economy has entered a new phase of
development, expanding 7.4% in 2014. The long term
strength and scale of China’s economy are evident –
with a total gross domestic product of over US$10 trillion,
this translates to an aggregate annual growth larger than
the United States.
For the past 20 years, we have entered and deepened our
presence in China by introducing the shopping mall,
serviced residence and Rafnes City concepts and
developing quality homes. CapitaLand’s 20
th
anniversary in
China provides a timely checkpoint – we are now one of
the largest foreign real estate developers in China with a
diversimed portfolio of integrated developments, shopping
malls, serviced residences, ofmces, homes and real estate
fund management. Our scale, expertise and in-depth
experience of over 20 years put us in an enviable position
as a provider of quality real estate products and services for
China’s goal towards sustainable urbanisation.
1
Includes PATMI from discontinued operation of S$29.1 million.
2
Includes Operating PATMI from discontinued operation of S$16.3 million.
3
Total assets excluding cash.
4
Excludes Singapore and China, and includes projects in Gulf Cooperation Council Countries.
5
Includes Australia.
Overview
