not vested
UOL Group (UOL SP) - Bright spots amid challenging environment
UOL Group’s 1H20 results fell short of our expectations.
Revenue and core PATMI dipped 28% and 37% YoY to S$908.2m and S$103.6m, respectively.
UOL saw a decent pick up in residential units booked in May and June despite the circuit breaker.
However, given the situation at the migrant workers’ dormitory, construction progress and consequently revenue recognition for its Singapore development properties has been delayed despite brisk sales.
For its Hotels business, revenue fell 57% YoY to S$136.8m in 1H20, as RevPAR for its owned hotels slumped 54.7%, 42.1% and 58.8% in Singapore, Oceania and Others, respectively.
Committed occupancy for its investment properties portfolio remained firm, with rental reversions flattish for both retail and office.
Shopper traffic in Singapore was down 41.7% in 1H20, but has seen some sequential recovery in Jun after the circuit breaker period.
After adjustments, we derive a lower fair value estimate of S$8.48 (previously S$9.41). Maintain BUY.
Source: OCBC