Heeton Holdings Limited’s turnover for HY2023 increased 7.8% to $30.70 million, mainly attributed to increase in hotel operation income due to higher occupancies of the Group’s hotels in the United Kingdom.

Financial Highlights

Personnel expenses increased by $1.40 million to $10.38 million in HY2023 mainly due to higher manpower costs mainly as a result of inflation. Other operating expenses increased to $14.02 million in HY2023 from $11.44 million in HY2022 mainly due to higher operating expenses as a result of inflation.

Finance expenses comprised mainly interest on the bond and bank loans. It increased by $4.30 million to $12.48 million mainly due to higher interest rate on bank borrowings.

Share of results from associated companies/joint venture companies was a loss of $1.02 million in HY2023 compared to $3.33 million in HY2022, mainly due to lower profit recognised for a development project after obtaining TOP and increase in finance expenses.

Heeton recorded a net gain from fair value adjustment of investment properties of $2.0 million in HY2023 mainly from Tampines Mart offset by fair value loss from 62 Sembawang Road. Income tax expense decreased by $1.14 million in HY2023 mainly due to lower profits for the period.

Overall, Heeton recorded a net loss after tax of $5.64 million for HY2023, compared to a net profit after tax of $1.47 million recorded in HY2022.

Business Outlook

According to the IMF World Economic Outlook Report of July 2023, global growth is projected to fall from an estimated 3.5 percent in 2022 to 3.0 percent in both 2023 and 2024. High interest rates continues to weigh on economic activity; while an intensifying Russia-Ukraine conflict, financial turbulence from tightening central banks’ fiscal policies, and sovereign debt distress could exacerbate current conditions and delay a global recovery.

In Singapore, Heeton’s two retail malls continue to provide a steady and reliable income stream. Opportunities for new developments are pursued strategically; with the newly imposed additional buyers’ stamp duty for foreigners now at prohibitive levels, Heeton is focusing on development projects aimed at the domestic market as part of a consortium tendering for government housing schemes.

Heeton’s hospitality division continues to face challenges, with international travel and tourism figures still below pre-pandemic levels and high operating expenses and interest rates driven by spiralling inflation. The global economic downturn however has delivered opportunities, and Heeton’s portfolio was augmented in April 2023 by the acquisition of its 14th hotel, located in Sapporo. In Thailand, Heeton’s two hotels will be relaunched in Q3 under new management, with the former Mercure Hotel Pattaya re-branding as the first Heeton Concept Hotel in South-east Asia.

Against this backdrop of economic uncertainty, Heeton continues to maintain a business approach founded on cautious optimism, carefully selecting its development and investment projects while streamlining and reconsolidating its existing assets both in Singapore and overseas.

Heeton’s shares as of 7 August 2023 after market close was at S$0.255.

About Heeton Holdings Limited
Established in 1976 and listed on Singapore Stock Exchange in September 2003, Heeton Holdings Limited is a real estate company focused on property development, investment and management, and hospitality.

Leave a Reply