Turnstar earnings slide

Staff Writer | Wednesday November 3, 2010 00:00

Revenue increased by 4.4 percent to P42 million on the back of improved occupancies in the retail segment of the property portfolio.

Retail segment revenue increased by 9.6 percent while the commercial segment suffered a 9.9 percent decline, owing to on-going refurbishments.

As a result, contribution to the top-line from the commercial segment declined from 27 percent to 23.3 percent in the period. Operating profit was impacted by a 16.7 percent increase in operating expenses to P16.3 million and a 13.6 percent decline in other income, declining by 2.3 percent to P 25.8m during the period.

The increase in operating expenditure was largely attributable to expenses related to the on-going refurbishment exercise and costs related to internalising the property and asset management function, which was originally outsourced. Profit before tax declined by 5.4 percent to P26 million on the back of an 80.7 percent decline in interest income as the company's cash reserves plunged 98.6 percent to P0.12 million.

Turnstar held P 27.2m in overdrafts in the period. Management further pointed out that the company had a loan facility approved which will be used to meet distributions to shareholders.

Profit after tax increased by 6.5 percent to P24.5 million as the tax charge grew 18.2 percent to P1.5 million. The profit for the year declined by a slightly lower margin, at 4.5 percent to P25 million, aided by a profit of P 0.5 million booked on the sale of investment property held for sale.

An interim distribution of P0.06 was declared (LDR 26 November 2010), payable on 10 December 2010.Investment properties increased by a marginal 6.1 percent, largely on the back of capital expenditure incurred on refurbishments. The yield on investment properties improved marginally to 14.4 percent during the period.