APAC Realty - Strong new home sales drove higher dividends

Strong profit growth in FY2025 led by new home sales

Revenue grew by 12.9% year-on-year in 2H FY25 to S$334.1 million, driven by strong sales of new projects in Singapore.  Revenue from new homes segment increased by 97.8% year-on-year to S$98.9 million in 2H FY25.  

Revenue from Resale and rental segment declined to S$231.1 million in 2H FY25, decreased by 4.3% year-on-year.  That said, this segment continued to be a major contributor to the revenue. 

For the full year FY2025, revenue rose 20.4% year-on-year to S$675.6 million, driven by a sharp rebound in new home sales.   New home revenue more than doubled, up 113.3% to S$230.1 million from S$107.9 million in FY2024. This reflects stronger primary market activity and higher developer sales volumes, which materially lifted overall brokerage income.

Resale and rental brokerage dipped 1.6% to S$437.8 million, suggesting a softer secondary market or lower transaction momentum. That said, the decline was modest and the segment remains the core earnings contributor, accounting for 64.8% of brokerage revenue.

As new home sales command higher commission rate, profit attributable to owners of the company increased by 184.9% year-on-year to S$20.55 million in FY2025. 

Revenue growth in FY2025 was volume-driven and skewed towards the primary market cycle.  While momentum is likely to ease in FY2026, higher selling prices, sustained volume in private residential segment and growth in the non-residential segment should help sustain revenue at a stable level.

2H FY25 dividend per share rose by 50% year-on-year

APAC Realty recommended DPS of 1.80 cents for 2H FY2025, an increase of 50% year-on-year.  The higher dividend per share was driven by strong revenue growth in the new private residential segment.

Total dividend per share in FY2025 of 4.50 cents translates to dividend payout ratio (DPR) of 78.2% of profit after tax and non-controlling interests. This is consistent with APAC Realty’s policy of maintaining dividend payout ratio in the 50% to 80% range. 

Since IPO in 2017, APAC Realty remains committed to strong shareholder returns while preserving financial flexibility. Average DPR of 76% is close to the upper end of the target range.

12,773 new units launched in 2025, the highest since 2013

In 2H FY2025, ERA Singapore was appointed as the marketing agency across 16 new home projects with a total of 7,347 units.  For the full year FY2025, ERA Singapore was involved in 27 new projects comprising about 12,773 units. 

The pipeline of new residential and industrial development remain robust in 2026.  Around 23 new residential projects, comprising 11,828 units, are scheduled to be launched.  On the industrial front, about 730 units are expected to be launched in 2026.

Of which, three projects have been launched – Coastal Cabana, Narra Residences and Newport Residences.  The average take-up-rate are fairly satisfactory, at 50% year-to-date. 

Overseas segment improving gradually

In FY2025, APAC Realty also recorded higher revenue from Vietnam, up 190% year-on-year to S$14.8 million. More importantly, ERA Vietnam has turned profitable and gross profit level is expected to be sustainable.  On the other hand, due to keen competition, contributed from ERA Indonesia will remain relatively modest.    

In terms of gross profit ERA Vietnam reported S$2.9 million in FY2025, up 190% year-on-year. The residential sales activity in Vietnam remains buoyant we expect ERA Vietnam to continue to show better performance in 2026.

Healthy financial indicators in FY2025

APAC Realty reported 2H2025 gross profit margin of 10.2%, compared with 8.7% in 2H2024. Higher proportion of new home sales which command higher profit margin drove a 150 basis points uplift in gross profit margin. 

APAC Realty reported cash balance of S$50.4 million as at 31 December 2025, compared with total debt of S$38.1 million. Thus, the company is in a net cash position of S$12.3 million. Management maintains financial flexibility and a reasonable level of cash-on-hand. 

Operating cash flow increased significantly, to S$30.2 million in FY2025, an increase of 230% year-on-year.   With the spectacular  results, the company reported net increase in cash of S$10.45 million. 

Outlook of Singapore property market

In 2H 2025, the industry’s transacted volume of new homes, excluding executive condominium, increased by 36% year-on-year to 6,228 units.  For the full year 2025, prices in Singapore home market remain strong. In 2025, private price and HDB price rose by 3.3% and 2.9% year-on-year, respectively. 

In 2H 2025, there were a strong pipeline of new projects launched, with around 7,340 new units launched. This brings total new home units launched to 12,769 units in 2025, an increase of 92% year-on-year. In 2026, APAC Realty estimates 11,828 units from new launches.  

We remain optimistic that financial performance will be supported by a healthy take-rate and moderate price increases.  Pent-up demand for new private residential homes is expected to continue to support transacted volume in 2026.  Prices of private residential homes are expected to rise by 3% to 4% in 2026. 

Key risks

Cyclical nature of real estate demand. The real estate market is cyclical, influenced by economic conditions, interest rates, and consumer confidence. During economic downturns, property transactions typically slow, impacting commission income. A sustained market slowdown could significantly reduce revenue and profitability. 

Government cooling measures. The Singapore government actively implements property cooling measures, such as Additional Buyer’s Stamp Duty (ABSD) and Total Debt Servicing Ratio (TDSR), to manage property prices. These regulations can dampen transaction volumes, particularly in the private residential segment, affecting  revenue from project marketing and resale transactions. 

Country concentration. Singapore is the core market for APAC Realty, contributing 92% of its gross profit. There is significant concentration risk . Furthermore, Singapore’s property market is subjected to frequent government’s intervention. Since 2013, the Singapore government has implemented a series of property cooling measures to curb excessive market speculation.  

Valuation

Maintain Neutral with 16.7% upside

Based on the FY2027 PE of 12.0x, we maintain the target price at S$0.70.  Currently trading at S$0.60, APAC offers a potential upside of 16.7% and FY26 dividend yield of 7.1%.    APAC Realty is trading at FY2026 PE ratio of 10.6x, near the historical average of 10.0x.   The valuation remains attractive compared with peers in Asia.

Related links:

• APAC Realty share price history and share price target
• APAC Realty history and dividend forecasts

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