CDI: 2020 Interim Results

--Directors' Review-- Financial Performance: CDL Investments New Zealand Limited ("CDI") can report that the Company has made an unaudited operating profit after tax of $13.74 million for the six month period ending 30 June 2020 (2019: $15.10 million). Operating profit before tax was $19.09 million (2019: $20.98 million). The result is particularly creditable given the fact that New Zealand as a whole was in a lockdown for six weeks from 26 March through to 14 May. Despite the restrictions on physical movement, online sales and promotional activity was able to continue which demonstrated that in the first six months of this year, interest in CDI's subdivisions and sections has not waned. Property sales and other income for the period was $40.96 million which exceeded last year's figure of $40.29 million. Net Asset Backing (at cost) for the period under review was 85.9 cents per share (2019: 77.6 cents per share). Portfolio update: All 91 sections in the Dominion Road, Papakura subdivision have been sold after the initial launch in December 2019. While COVID-19 has meant delays with its commercial developments at Stonebrook (Rolleston) and Prestons Park (Christchurch), we are still targeting completion and occupancy by the end of this year for the Stonebrook Local Centre development and Q2 2021 for the Prestons Park Urban Village development.. Commentary and Outlook: While we are happy with our sales performance to date, the second half of this year may be weaker than the first. The fact that the sales we have settled to date have mainly come from our Kewa Road and Prestons Park developments in Auckland and Christchurch, respectively, is encouraging and vindicates our strategy to progress developments which are more likely to sell quickly. New stages are therefore being developed to meet demand and we believe that these will also sell well during this year. The same approach is being adopted across our other developments where we will only develop and complete as many sections as we believe to meet the demand. CDI did not seek government assistance such as the Wage Subsidy and we are in the fortunate position in that we have not had to make any redundancies or reduce our employees' hours. We are very aware that several of the businesses we are dealing with have had to take steps to deal with the crisis and we are looking to support them where practicable. Our target is to deliver another positive result and a dividend to shareholders once again but the economic effects of COVID-19 are expected to be significant and long-lasting. While the New Zealand property market has passed its peak, we remain quietly confident about our prospective sales for the rest of the year. The Board and Management are monitoring the sales and development programmes very carefully and will not hesitate to make decisions where necessary to ensure that CDI is able to perform to its maximum potential during extremely challenging times while remaining mindful of CDI's long term investment strategy. Colin Sim Chairman __Media Release__ CDL INVESTMENTS SHOWS CREDITABLE FIRST HALF SALES PERFORMANCE IN SPITE OF COVID-19 NZX-listed property development and investment company CDL Investments New Zealand Limited (NZX:CDI) today released its (unaudited) results for the six months to 30 June 2020 and reported an operating profit after tax of $13.74 million (2019: $15.10 million) on revenue of $40.96 million which exceeded last year's figure of $40.29 million. "It's testament to the quality and location of our product", said CDI's Managing Director Mr. BK Chiu. "Despite six weeks of lockdown, we were still able to make and record sales and we are pleased with our first-half performance", he said. CDI said that the majority of its sales in the period came from its Auckland subdivision at Kewa Road (North Shore) and Prestons Park (Marshlands/ Burwood) in Christchurch. This was a vindication of its strategy to focus on the areas where there was sales demand and develop as much as required to meet the market. "It sounds simple but given the softening market last year and the extreme events caused by COVID-19, predicting demand and which areas will perform well has not been an easy matter", said Mr. Chiu. "Having a well-spread portfolio also helps", he said. The company was nevertheless cautious about the second half of 2020 and was not giving any revenue guidance saying that consumer confidence would greatly influence the number of sales it was targeting for the year as well as 2021. "The full economic effects of COVID-19 are yet to be felt and while we are optimistic about how we will perform this year, the same cannot be said for everyone else and we need to be sensitive to this", Mr. Chiu said. "We want to give shareholders confidence that we are targeting a positive result and a dividend but what both of those will look like remains to be seen and very much subject to market forces outside of our control. What we can control and manage, we will do so carefully while remaining mindful of CDI's long term investment strategy", he said. ENDS Issued by CDL Investments New Zealand Limited Any inquiries please contact: B K Chiu Managing Director CDL Investments New Zealand Ltd (09) 353 5077 End CA:00357015 For:CDI Type:HALFYR Time:2020-07-29 08:30:24