Roxy-Pacific’s 1Q19 revenue rose 91% YoY to S$88.5m, due mainly to higher contribution from the Property Development segment, with revenue recognition from The Hensley (Sydney) upon settlement in 1Q19 and progressive revenue recognition from The Navian.

Gross profit margin fell from 32% in 1Q18 to 24% in 1Q19, due mainly to higher contribution from the Property Development segment which commands a lower profit margin.

Distribution and selling expenses rose 54% YoY to S$3.4m on the back of showflat expenses incurred for View at Kismis, Fyve Derbyshire, RV Altitude and Dunearn 386.

Stripping out the share of results of associates contributed mainly by FV gain from 117 Clarence Street (divested in Aug18), PBT would have increased 204% to S$7.3m.

The group’s 1Q19 PATMI came in at S$5.3m, which was 12.9% of our full-year forecast; we deem this to be under our expectations.

We maintain our HOLD rating and FV of S$0.41.

Source: OCBC Research - 9 May 2019