Far East Orchard Ltd reported profit attributable to equity holders of S$11.8 million for the six months ended Jun 30, 2026, down 39.9 per cent year-on-year after the absence of a S$9.1 million non-cash gain booked a year earlier. Revenue more than doubled to S$248.5 million, lifted by the consolidation of Homes for Students (HFS) in the United Kingdom and firmer hospitality takings.
No interim dividend was declared and the company made no reference to dividends in the filing.
Group operating profit inched up 1.0 per cent to S$31.2 million. Hospitality revenue rose 11.6 per cent to S$62.2 million, supported by stronger trading at Rendezvous Hotel Perth Scarborough and initial contributions from two Osaka properties opened in 2025. Purpose-built student accommodation (PBSA) turnover surged 329.7 per cent to S$130.4 million after the HFS consolidation, though revenue from the group’s owned PBSA assets slipped 4.4 per cent to S$29.0 million due to softer occupancy in selected cities.
Adjusted PATMI, which strips out non-recurring items, grew 7.7 per cent to S$9.8 million, aided by property divestment gains and lower interest expenses. The group completed S$50.7 million of asset disposals — Westminster Fire Station in London and a unit at Novena Medical Center in Singapore — and repaid S$52.2 million of borrowings, trimming total debt to S$590.0 million and reducing the debt-to-equity ratio to 41.2 per cent from 45.4 per cent. Average funding cost declined to 4.9 per cent, with 64 per cent of borrowings on fixed rates.
Strategic moves in the half included the phased acquisition of HFS, making Far East Orchard one of the UK’s largest independent third-party PBSA operators with about 60,000 beds under ownership and management. Development of the 706-bed Timber Yard project in Bristol remains on schedule for August 2026 completion, while the 273-bed Glasgow scheme and 239-bed Plymouth Grove project continue to progress under the Far East UK Student Accommodation Development Fund. In hospitality, joint-venture arm TFE Hotels opened the 148-key Adina Apartment Hotel Chermside Brisbane in May.
Chief executive Alan Tang said the results reflected “steady progress” under the FEOR30 strategy. He attributed revenue growth to the enlarged PBSA platform and highlighted ongoing capital recycling to bolster balance-sheet flexibility. Tang noted that management would prioritise recurring earnings growth and prudent investment as macroeconomic conditions stay mixed, with particular attention on revenue management and asset enhancements in the hospitality segment and selective deployment of capital into PBSA developments.
Looking ahead, the group expects operating conditions to remain uneven amid geopolitical uncertainties and varying travel trends. While international visitor arrivals softened in Singapore during the first half, Australia is seeing a gradual recovery and Japan continues to benefit from strong tourism demand. In the UK, a 4.6 per cent rise in university applications for the 2026/27 academic year underpins demand for quality student housing, though rental growth is moderating. Far East Orchard plans to balance expansion opportunities with disciplined capital and debt management to support long-term recurring income growth.