Real estate developer Heeton Holdings has achieved a significant jump in earnings for the second half of the financial year 2024, with a 221% increase compared to the same period last year. The group reported a profit of $3.85 million for the 2HFY2024, which ended on December 31, 2024. However, for the full year of FY2024, the group is still operating at a loss.
During the 2HFY2024, Heeton’s earnings per share came in at 0.79 cents per ordinary share. However, for the FY2024, the group reported a negative 0.28 cents per share. This indicates that while there has been a significant improvement in earnings, the group is still facing challenges in terms of overall profitability.
Heeton’s revenue for the 2HFY2024 also saw a positive growth of 10.5% year-on-year, reaching $41.1 million. Similarly, for the full year, the group’s revenue increased by 15.2% to $78.2 million.
The group attributed this growth to a combination of factors, including rental income from investment properties, hotel operation income, and management fee. In FY2024, the group’s turnover experienced a 15.2% year-on-year increase due to higher occupancies in the United Kingdom and an increase in rental rates for its investment properties.
Aside from revenue growth, the group also experienced a net gain of $3.78 million from the disposal of some of its subsidiaries. This included its 70% interest in Gloucester Corinium Avenue Hotel Limited and Ensco 1154 Limited.
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Heeton’s property, plant, and equipment amounted to $418.83 million in FY2024, mainly consisting of hotel properties. Compared to the previous year, there was an increase of $16.92 million due to the acquisition of a hotel in Edinburgh, United Kingdom. The appreciation of Pound Sterling and reversal of impairment changes offset by the disposal of hotels in Japan and the United Kingdom and depreciation charges recognised.
In terms of cash flow, the group saw a decrease of $32.70 million in cash and cash equivalents due to significant inflows and outflows. This includes proceeds from the disposal of property, plant, and equipment of $26.43 million and proceeds from the disposal of subsidiaries of $11.37 million.
On the other hand, there were cash outflows, such as a net repayment of loans from associated and joint venture companies of $24.45 million, additions to property, plant, and equipment of $40.36 million, and restricted cash pledge for a bank facility of $22.98 million.
Given the current economic and geopolitical uncertainties, Heeton aims to maintain its prudent and steady strategic expansion. The group operates a bespoke boutique brand that offers high-quality and experiential stays for its guests. Despite headwinds faced by the hospitality industry, including high operating and labour costs, elevated interest rates, and an uncertain macroeconomic environment, Heeton will continue to build on its strengths and offerings.
Furthermore, the group consistently participates in land tenders in the local residential market, often in a consortium. Despite this, Heeton’s two retail malls are expected to generate stable and recurring income for its property investment business.
Heeton has declared a final dividend of 0.5 cents per share for the current financial period. On February 20, Heeton’s shares closed at 27 cents, a 0.5 cent decrease or a 1.818% drop.