| To : Business Editor | 14th March 1996 For immediate release |
CYCLE & CARRIAGE LIMITED 1995 PROFIT AND DIVIDEND
ANNOUNCEMENT
The attached press announcement was released
today by the Company's 23%-owned associate, Cycle & Carriage.
For further information, please contact:
| Ludgate Asia Limited Martin Spurrier |
Tel: (852) 2543 5413 (office) |
RESULTS
The Board of Directors announced today an unaudited consolidated
net profit after taxation and minority interests for the year
ended 31 December 1995 of S$182 million, an increase of 47% over
the previous year.
Earnings per share for the year were 77.8¢ compared with
53.1¢ for the previous year, an increase of 47%.
DIVIDEND
The Directors recommend a final dividend of 24¢ or 24% (1994:
17¢ or 17%) per share, less income tax at 26% (1994: 27%),
which, together with the interim dividend of 8¢ or 8% per
share, will make a total annual dividend in respect of 1995 of
32¢ or 32% per share. This is an increase of 39% over the
previous year.
The final dividend, if approved, will be payable in cash on Thursday,
30 May 1996 to shareholders whose registrable transfers are received
by the share registrar, Coopers & Lybrand, 9 Penang Road,
#10-20 Park Mall, Singapore 238459 by 5 p.m. on Friday, 17 May
1996.
CORPORATE EVENTS
In the first quarter, 96% of the outstanding Transferable Subscription
Rights in Malayan Credit Limited were exercised. Those that remained
unexercised expired on 20 March 1995. As a result of the exercise
of the Transferable Subscription Rights, Cycle & Carriage
Limited's interest in Malayan Credit Limited was reduced to 57%.
In April, Cycle & Carriage Limited acquired an additional
9 million shares in Malayan Credit, increasing its holding to
220.4 million shares, representing 60% of the shares in issue.
The Cycle & Carriage Limited registered office moved to Cycle
& Carriage's new headquarters at 239 Alexandra Road, Singapore
159930, on 3 July 1995.
OPERATIONAL REVIEW
Motor
Motor earnings for the year rose to S$135.8 million, a 45% increase
over 1994.
The Singapore motor operations had an excellent year. The principal
reason for this favourable performance was strong sales of Mercedes-Benz
and, in particular, the success of the E-class "Masterpiece"
in the months before the new E-class model was introduced. Mercedes-Benz
passenger car unit sales were 4,600, an increase of 15% over 1994,
making Mercedes-Benz the second largest selling marque in Singapore,
just behind Toyota. In contrast, Mitsubishi sales and margins
were weak for much of the year due to the strength of the Yen
and the highly competitive segment of the market in which Mitsubishi
operates. Proton sales were up 15% on 1994 and the Proton Wira
was the top selling car model in Singapore.
Cycle & Carriage Bintang ("CCB") also had a good
year, announcing a profit after tax and minority interests of
RM77.4 million, 86% up on 1994. This was largely attributable
to Mercedes-Benz car sales which were almost 100% up on 1994.
Assembly capacity was increased during the year, enabling sales
to be increased and the customer waiting list reduced. Mercedes-Benz
commercial vehicles also made a useful contribution. CCB was recently
appointed as the Malaysian distributor of Kia, the Korean vehicle
manufacturer. CCB, together with our Malaysian dealership operation,
Cycle & Carriage (Malaysia), contributed 16% of the Group's
motor earnings.
Our Australian motor operation continued to grow, further consolidating
its position as Australia's largest car importer. Hyundai sales
rose to 35,600 units, representing 7% of the Australian passenger
car market, an increase of 46% over 1994. 4,900 units of the Chrysler
Jeep were sold, making it the third top selling 4x4 vehicle in
its first full year of sales. Our Australian company has also
been awarded the Chrysler franchise for New Zealand. In New Zealand,
our dealerships generated increased profits and will commence
selling the Chrysler Jeep in 1996. Australia and New Zealand together
contributed 8% of the Group's motor earnings.
The New Era Cycle & Carriage Ford distributorship in Thailand
had a very difficult year, despite unit sales increasing by 82%
to 5,200. Poor margins and the need to make certain debt provisions
resulted in a substantial loss.
In Vietnam, Cycle & Carriage's Ford operation also incurred
start-up costs and is unlikely to turn around until locally-assembled
vehicles become available in 1998. C&C's other Vietnam operations
contributed a small profit. In Myanmar, C&C was appointed
as the distributor for both Ford and Mitsubishi during the course
of the year.
Property
Property earnings for the year rose to S$44.1 million, an increase
of 63% over 1994.
Malayan Credit has announced earnings of S$44.3 million, an increase
of 54% over 1994, with the principal contributor being profits
from the Mera Terrace residential development, for which 49% of
the development profit was recognised in 1995. Investment property
earnings were well down on 1994 following the sale of Ardmore
Park, but this was partially offset by interest earned from the
company's resulting cash surplus and increased rental income from
78 Shenton Way. In last quarter of 1995, Malayan Credit fully
sold its Seven Oaks and 28 Scotts developments, the latter being
jointly owned with Hotel Properties, and by the year end had sold
more than 50% of the units at Mera Gardens.
Malayan Credit has entered into two joint ventures for the development
of mixed residential and commercial sites in Shanghai and, in
February 1996, it acquired a prime site for residential development
in the Balmoral area of Singapore.
CCL Group Properties, which contributed 40% of the Group's property
earnings, recognised 31% of the expected profit from its MeraLodge
condominium development. Wisma Cyclecarri and The Weld podium
were almost fully occupied throughout the year, despite disruption
from the construction of the tower, which is progressing well
and is expected to be completed in late 1996. The contribution
from CCL Group Properties also included a profit of S$7.4 million
on the sale of a site at Jalan Barat in Petaling Jaya.
Food & retail
The food & retail operations recorded a profit of S$0.6 million
for the year, compared to a loss of S$0.2 million in 1994. The
Guardian pharmacy business continued to grow profitably. However,
the increased contribution from Guardian, together with higher
earnings from Cold Storage (Malaysia)'s own property interests,
was offset by the start-up costs incurred by the Nestlé Cold Storage
and supermarket joint ventures.
Other interests
Net earnings from other interests fell to S$1.1 million, from
S$3.2 million in 1994. The contribution from the Group's other
associated companies was S$4.9 million compared to S$4.7 million
in 1994. The cost of the Group's central overhead and financing
expenses increased from S$1.5 million to S$3.8 million, due to
lower translation and financing gains.
PROSPECTS
The Group's Singapore motor operations have had an exceptional
year which will be difficult to match in 1996. In Malaysia and
Australasia, profits from our motor interests have grown substantially
over the last two years and we would expect to make further progress
in 1996. In Thailand, where our business is relatively new, the
initial losses that have been incurred are expected to be reduced.
C&C's property earnings in 1996 will come largely from developments
that have already been sold. The returns from the Group's investment
properties should continue to improve as they benefit from the
strengthening in commercial rental rates. The contribution from
food and retail is likely to remain flat as earnings will continue
to be affected by the cost of growing our joint ventures.
Barring unforeseen circumstances, the results of the Group for 1996 are expected to be satisfactory.
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