REAL estate management services group LHN posted a net profit of S$14.8 million for the half-year ended March 31, 2021, from S$3.2 million the year before.

 

Gross profit jumped 60.5 per cent to S$35.2 million. The group' s revenue from its facilities-management business increased 226 per cent to S$31.6 million, with services having provided for short-term contracts under the dormitory business.

 

At the height of the Covid-19 outbreak among migrant workers last year, LHN secured contracts to convert spaces into workers' dormitories and to manage them.

 

Meanwhile, cost of sales fell 1.4 per cent to S$29.3 million, mainly due to a fall in rental costs, partly from the expiry of four master leases in FY2020 and accounting changes.

 

Other income more than doubled to S$6 million after rental rebates, job subsidies and increase in gains from subleases pursuant to IFRS 16 accounting standards.

 

Earnings per share was 3.68 Singapore cents, up from 0.79 cents the year before. LHN has proposed an interim dividend of 0.75 cents per share. The year before, it declared an interim dividend of 0.25 cents per share.

 

Revenue from the group' s core business of leasing out industrial, residential and commercial properties (which LHN describes as space optimisation) took a hit, falling 33.6 per cent on the year.

 

Revenue for the largest segment, industrial properties, fell 42.7 per cent with the expiry of the four master leases, and more derecognition of revenue from subleases classified as finance leases.

 

Average occupancy rate decreased slightly to 89 per cent from 89.9 per cent the year before.

 

Revenue from commercial properties fell as well, by 53.8 per cent, due to expiry of master leases, a decrease in revenue from 1557 Keppel Road in Singapore, which is undergoing renovations, and recognition of revenue from subleases.

 

Average occupancy rate fell by 15.3 percentage points to 69.2 per cent.