Overseas Realty records 77% profit growth for nine months

Saturday, 12 November 2011 00:00 - - {{hitsCtrl.values.hits}}

Real estate and property development group Overseas Realty (Ceylon) PLC is consolidating its post war growth momentum as reflected in the nine months results released to the Colombo Stock Exchange.

The Group recorded revenue of Rs. 1,657 m and net profit of Rs. 440 m, which is an increase of 42% and 77% respectively over the corresponding period of the previous year.

The unrealised exchange gains recorded for Mireka Group, its main subsidiary, in the first half of the year was partially eroded in the last two months of the third due to the depreciation of the rupee against the dollar. The reported profit excludes fair value gains on the substantial investment property owned by the company – the iconic World Trade Centre (WTC).

Rental income from the WTC for the period grew by 20% over the previous year with occupancy increasing by almost 18% over September 2010 and is almost 5% above the previous quarter. The net profit of the company, which reflects the WTC operation, was Rs. 294 m for the period, which is an increase of 56% over the previous year.

A company spokesman stated that the signed up office space commitments as at date will result in the company enjoying a occupancy of 90% by end 2011 and a committed occupancy of nearly 95%.

As reported by the company, Havelock City which entered a rapid phase of development has commenced construction of its state-of-the-art Clubhouse whilst piling has been completed for the next two residential towers.

The commercial complex comprising the largest shopping mall in Sri Lanka and twin office towers is at an advanced stage of design and construction is expected to commence towards the end of the first quarter of 2012.

Revenue from the sale of apartments during the period under review was Rs. 1,017 m, an increase of 63% over the previous year. Revenue reflects the sales generated from Phase 1 which comprise two completed towers of the residential development. Phase 2 pre-sales have commenced, however, this is not reflected in revenue.

The company is also establishing itself gradually in fee based realty and property management services through its subsidiary Realty Management Services. In addition to managing the facilities at the WTC and Havelock City, Realty Management Services is engaged in leasing of office space, sale and renting of apartments, absentee land lord management and the management of third party facilities and properties.

The Group is optimistic and very confident of the economy in general and the property sector in particular and has planned substantial investments and allocation of resources to expand its business activities.

Overseas Realty Group CEO Pravir Samarasinghe stated: “The high occupancy level at the World Trade Centre augurs well for the future and the company is now focused on rate and yield enhancement.”

Havelock City, the brainchild and dream of ORCL Group Chairman S.P. Tao has now entered a rapid phase of development, he added.