Singapore billionaire Kwek family’s CDL posts net profit growth as board moves past father-son feud

It posted a net profit of S$91.2 million (US$71.1 million) for the period, up 3.9% from S$87.8 million a year ago, The Business Times reported.

Revenue also rose 8% year-on-year to S$1.69 billion, largely fueled by its property development segment.

During the period, CDL wrapped up the full sale of its Copen Grand, a joint venture executive condominium project completed in April, along with several other smaller projects.

It has finalized divestments worth over S$1.5 billion this year, including some U.S. hotels and commercial properties in Singapore, and reached a deal to sell a majority stake in the S$2.75 billion South Beach complex in the city-state’s central business district, which is expected to wrap up in the third quarter.

It has also aimed to make roughly S$1.2 billion in new investments, such as local land acquisitions. It recently won bids for two executive condo plots in the city-state.

Sherman Kwek, group CEO and son of executive chairman Leng Beng, said in the firm’s Wednesday news release: "Looking ahead, while the operating environment remains fluid, the potential easing of interest rates offers further upside as we continue to pursue our capital recycling and fund management initiatives."

He has been focusing on paring CDL’s debt and restoring investor confidence, which was shaken by the high-profile dispute within one of Singapore’s wealthiest families earlier this year.

In February, he was sued by his father, who alleged that Sherman had orchestrated a boardroom coup to seize control of the company. The lawsuit sparked a public spat that made headlines and triggered a slump in CDL’s stock prices, The Straits Times reported at the time.

Though it was dropped in March, Sherman remains under pressure to boost the company’s share performance.

CDL’s net debt-to-equity ratio, which factors in the fair value of investment properties, fell two percentage points to 70% at the end of the first quarter. Its shares have outperformed Singapore’s benchmark index this year and its market capitalization now tops S$6 billion. So far, investors have responded positively to these efforts, according to Bloomberg.

"We remain steadfast in building a resilient and future-ready organization, anchored in trust, performance and sustainable growth," Leng Beng said in the new release.

Challenges may still lie ahead, as an April shareholders’ meeting revealed lingering tensions among board members. In July, long-serving director Philip Yeo, who had supported Leng Beng during the earlier feud, stepped down after 16 years on the board.

Nonetheless, Sherman said at a results briefing on Wednesday that succession plans for the chairman role are "fluid," adding that they would also depend on discussions and the views of shareholders and the board.

Leng Beng, meanwhile, emphasized that the board and management were aligned. "We have put past issues behind us, emerging stronger and more unified," he said.