UOL (SGX:U14) reported 2H25 revenue of S$1.68bn (+11% y-o-y), led mainly by higher contributions from its residential development and investment property segment. 2H25 PATMI grew 21% y-o-y to S$276.2m on higher associate income and lower interest expense.
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FY25 EPS above expectations
2H/FY25 EPS of 32.7/57 cents was above our expectations, at 82%/143% of our FY25F forecasts.
Residential development revenue surged 24% in FY25 to S$1.51bn, on progressive revenue recognition from Pinetree Hill (97% sold as at end-FY25), Watten House (98% sold at end-FY25) and MEYER BLUE (73% sold at end-FY25) as well as UPPERHOUSE at Orchard Boulevard (77% sold at end-FY25).
UOL’s FY25 hotel portfolio performance improved with higher occupancy in Oceania and RevPAR rising 13% y-o-y.
Upward revision of UOL’s RNAV
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Our upward revision of UOL’s RNAV is due to three factors:
marking to market its hotel assets that are currently held as fixed assets and depreciated;
factoring in potential value accretion from the redevelopment of the Marina Square complex and The Clifford at Raffles Place redevelopment; and
updating residential contributions based on its latest landbank wins, including Dorset Rd and Hougang Central government land sale sites.
In its 2024 annual report, UOL indicated that the open market value of its hotel properties was S$4.66bn and that it has a net book value of S$2.83bn as at end- 2024. The surplus of S$1.83bn has not been factored into its financial statements. These assets include some of its hotels in Singapore, Australia, South East Asia (ex-Singapore) and UK, as well as hotels owned by its subsidiary Singapore Land (SGX:U06), such as Pan Pacific Singapore and PARKROYAL Collection Marina Bay in Singapore. A back-of-envelope calculation shows that should its hotels be marked-to-market, the total S$1.83bn of surplus could add more than S$2/share to UOL’s book value.
In our UOL RNAV estimate, we have pegged in S$1.10/share of additional value creation from the mark-to-market of the Pan Pacific Singapore and PARKROYAL Collection Marina Bay hotels.
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Above is an excerpt from a research report by CGSI Research. Clients of CGS International may access the full PDF report @ https://itrade.cgsi.com.sg/.
