CDI: 2017 Results Announcement

CDI provides its audited financial statements for the year ended 31 December 2017 together with its Directors' Review and Media Release, the text of which follows below: *** DIRECTORS' REVIEW Financial Performance CDL Investments New Zealand Limited ("CDLI") is pleased to report a profit after tax of $32.2 million for the year ended 31 December 2017, an increase of 19.0% from the previous year (2016: $27.0 million). This result is the eighth consecutive year of profit growth for the company. Profit before tax also increased to $44.7 million (2016: $37.5 million). Property sales & other income totalled $78.7 million (2016: $74.5 million). Shareholders' funds as at 31 December 2017 increased to $186.1 million (2016: $161.8 million) and the company's total assets stood at $191.7 million (2016: $168.3 million). The net tangible asset per share (at book value) was 67.1 cents (2016: 58.4 cents). Dividend Announcement Reflecting the record result, CDLI has resolved to increase its fully imputed ordinary dividend to 3.5 cents per share (2016: 3.0 cents per share), payable on 18 May 2018. The record date will be 4 May 2018. The Dividend Reinvestment Plan will apply to this dividend. Land portfolio At 31 December 2017, the independent market value of CDLI's land holdings was $276.3 million (2016: $297.0 million). CDLI's accounting policies require the company to carry the value of its land portfolio at the lower of cost or net realisable value and at 31 December 2017, the land portfolio at cost was $124.7 million (2016: $117.8 million). Summary and Outlook The New Zealand housing stock and new housing supply remains short of demand. This can explain why while housing sales have eased, pricing has only evened out. The Reserve Bank's LVR restrictions and the availability of finance have both had an effect on the New Zealand housing market. That said, although not as strong as in 2016, demand for CDLI housing sections remained steady in 2017. The Overseas Investment Amendment Bill proposed by the Government last December is expected to have some but minimal impact on CDLI's business model of acquiring land for residential development. The proposed new Government measures classifying residential housing land as "sensitive land" is a demand-side measure and aimed "not to impede the broader objective of increasing the supply of residential housing". As a development company in housing sections, CDLI has consistently demonstrated its "financial commitment, business experience and acumen and good character" with its commitment to increasing the supply of sections for residential housing. The Overseas Investment Amendment Bill in its current form may however have unintended consequences. These include the number of consent applications and time required to process them. Both measures are expected to increase with significant delays and costs to the housing industry. CDLI will continue to drive sales activity of its existing housing sections in 2018 with the aim of delivering another year of growth in 2018. The Board and management will also continue to progress consents and future development approvals for projects in the pipeline as well as continue to seek to acquire additional land for future development. Management and staff On behalf of the Board I sincerely thank the company's management and staff for their hard work during 2017 to deliver these excellent results. Colin Sim Chairman 8 February 2018 ***Media Release*** 19% PROFIT GROWTH FOR CDL INVESTMENTS NEW ZEALAND Property development company CDL Investments New Zealand Limited (NZX: CDI) today reported its results for the year ended 31 December 2017. CDI increased its profit after tax by 19.0% to $32.2 million with property sales & other income increasing by 5.6% to $78.7 million over 2016. "We are very pleased to report another year of increased profit performance" said managing director Mr. B K Chiu. "Our housing sections in Auckland, Hamilton and Christchurch with their locations and design remain attractive to buyers despite a less buoyant market compared to 2016." "The property market moves in cycles. With new legislation on LVRs, availability of finance together with the levelling of net migration, 2017 could be seen as a correction year and this can be viewed as positive in moderating the exuberance of the market. However, supply of housing remains short of demand notably in the Auckland region. We continue to see a steady but subdued demand for our sections and this underlying demand is not surprising as home ownership remains an aspiration dear to New Zealanders. To this end we continue to programme the development and release of new sections for sale in 2018 and 2019 as well as implementing our land purchase plans for the future," said Mr Chiu. CDI's Board resolved to increase its dividend to 3.5 cents per share (from 3.0 cents in 2016) fully imputed which would be released to shareholders on 18 May 2018. The record date would be 4 May 2018 and the Dividend Reinvestment Plan would apply to this dividend. Summary of results: o Profit after tax $32.2 million (2016: $27.0 million) o Profit before tax $44.7 million (2016: $37.5 million) o Total revenue & other income $78.7 million (2016: $74.5 million) o Shareholders' funds $186.1 million (2016: $161.8 million) o Total assets $191.7 million (2016: $168.3 million) o Net tangible asset value (at book value) 67.1 cents per share (2016: 58.4cps) o Earnings per share 11.60 cents per share (2016: 9.77cps) About CDL Investments New Zealand Limited: CDL Investments New Zealand Limited (CDI) has a proud track record of acquiring and developing residential sections in New Zealand for two decades. With a focus on creating and developing a range of high-quality residential sections to New Zealanders, CDI has over the past twenty years successfully completed numerous subdivision projects in Auckland, Hamilton, Tauranga, Hastings, Havelock North, Taupo, Nelson, Christchurch, Rolleston (Canterbury) and Queenstown. CDI is a majority-owned subsidiary of NZX-listed Millennium & Copthorne Hotels New Zealand Limited. ENDS Issued by CDL Investments New Zealand Limited Enquiries to: B K Chiu, Managing Director (09) 353 5058 *** End CA:00313926 For:CDI Type:FLLYR Time:2018-02-08 15:55:59