UOL

UOL: FY11 results in line to slightly above expectations.
Core net profit came in at $535.1m, +22% yoy, with increased contribution from all divisions. The bulk of earnings growth was driven from the residential devt business with progressive recognition of pre-sold projects.
Co announced 15cts div, implying 3.1% yield.

Property devt remained the key contributor to earnings (66% of group), delivering EBIT of $404.8m (+1576% yoy). In 2011, UOL sold 164 units with sales value of $311m (Spore).
Invmt properties saw steady earnings growth, with EBIT up 10% yoy driven by higher rentals from its retail properties which offset the decline in rentals from its office portfolio.
UOL’s hotels also delivered EBIT growth of 16% yoy with strong RevPAR growth in Spore (+13%). UOL is expected to see additional income boost from its Upper Pickering Street devt (100% leased office & 363 room hotel), which is slated to be completed by end 2012.

BOA-ML maintains Buy rating, raise TP from $4.80 to $5.20 which translates to 40% discount to RNAV and 11x FY12E P/E. Likes the developer’s resilient earnings stream and compelling valuations.