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CapitaLand Limited
Annual Report 2015
Overview
Sustainability
Business
Review
Portfolio
Details
Corporate
Governance &
Transparency
Financials &
Additional
Information
Economic Value Added Statement
Note
2015
S$ million
2014
S$ million
Continuing and discontinued operations
Net operating profit before tax
1,112.7
1,046.6
Adjust for:
Share of results of associates and joint ventures
726.0
986.2
Interest expense
481.6
446.1
Others
42.6
61.0
Adjusted profit before interest and tax
2,362.9
2,539.9
Cash operating taxes
1
(498.9)
(319.4)
Net operating profit after tax (NOPAT)
1,864.0
2,220.5
Average capital employed
2
36,121.7
35,573.6
Weighted average cost of capital (%)
3
6.00
6.50
Capital charge (CC)
2,167.3
2,312.3
Economic value added (EVA) [NOPAT - CC]
(303.3)
(91.8)
Non-controlling interests
152.9
55.7
Group EVA attributable to owners of the Company
(150.4)
(36.1)
1
The reported current tax is adjusted for the statutory tax impact of interest expense.
2
Monthly average capital employed included equity, interest-bearing liabilities, timing provision, cumulative goodwill and present value of
operating leases.
Major capital components:
S$ million
Borrowings
16,825.0
Equity
18,883.8
Others
412.9
Total
36,121.7
3
The weighted average cost of capital is calculated as follows:
i) Cost of equity using Capital Asset Pricing model with market risk premium at 5.78% (2014: 5.75%) per annum;
ii) Risk-free rate of 2.27% (2014: 2.40%) per annum based on yield-to-maturity of Singapore Government 10-year bonds;
iii) Ungeared beta ranging from 0.54 to 1.19 (2014: 0.57 to 1.00) based on the risk categorisation of CapitaLand’s strategic business units; and
iv) Cost of debt rate at 3.00% (2014: 3.00%) per annum using 5-year Singapore Dollar Swap Offer rate plus 125 basis points (2014: 150 basis points).
