- APAC Realty (SGX:CLN) reported a 17.9% y-o-y decline in 2H23 revenue to S$297.6m, while PATMI fell 31.4% y-o-y to S$6.8m. The weaker y-o-y revenue was due to lower brokerage revenue from new home sales, partly offset by higher resale and rental market commissions. As product mix skewed to the lower yielding resale segment, 2H23 gross profit margin dipped from 10.5% in 2H22 to 9.5% in 2H23.
FY23 EPS below expectations
- - Read this at SGinvestors.io -
- APAC Realty proposed an interim dividend of 1.4 cents, bringing FY23 dividend to 2.5 cents.
Resale commissions dragged by slower market volumes
- - Read this at SGinvestors.io -
- For FY2024F, APAC Realty expects the private resale segment’s volumes (including sub-sales) to improve to ~15-20% y-o-y, while HDB resale volumes would likely remain stable at 26k-27k.
- APAC Realty’s salesforce of 8,891 agents at end-FY23 was below its earlier guidance target of 9,300; however, management reiterated during its FY23 results commentary that it is maintaining its plans to expand its agent force to 10,000 by 2024F. This should bolster APAC Realty’s market share and boost resale and rental commissions in FY24F, in our view.
- Management also reiterated its strategy to expand its overall volume market share of 40.7% at end-FY23, over the next few years.
New home sales volume recovery should bolster revenue
- Read more at SGinvestors.io.
