Boustead Q2 earnings up 94% at S$17.5m
Singapore
TECHNOLOGY and engineering group Boustead Singapore reported a net profit of S$17.5 million for its second quarter ended Sept 30, up 94 per cent from S$9 million a year ago. Revenue increased by 14 per cent from S$113.3 million to S$129.7 million.
An interim dividend of two Singapore cents a share was declared, unchanged from a year ago. Investors can also opt to get their dividends in scrip.
Boustead said its revenue is largely derived from project-oriented businesses so full year to full year comparisons, instead of quarterly results, are more appropriate for analytical purposes.
The higher Q2 profits were driven by a higher gross profit margin as well as lower other losses. A higher gross profit margin was due to cost savings realised from several completed projects under the real estate solutions division, the company said.
This segment designs environmentally-sustainable industrial facilities for companies. It has secured S$200 million of contracts since April, more than what it got in the whole of its last financial year, Boustead said.
Boustead also has two other segments: energy-related engineering, which provides technologies for the oil and gas, power and water sectors, and geo-spatial technology, which distributes geographic information systems.
All three segments grew in revenue and profit for the second quarter.
Wong Fong Fui, Boustead chairman and CEO, said the company expects to deliver a reasonable level of profit for its current financial year.
This is because of the company's order book, which stood at S$441 million at end-September, and business development initiatives in the real estate solutions segment, he said. These initiatives include partnering a Middle East sovereign wealth fund in August to develop logistics and industrial facilities in Singapore.
Profits can be achieved "despite an increasingly challenging business climate caused by a highly competitive Singapore industrial real estate market and the recent negative sentiments in the energy sector following the major decline in global crude oil prices," Mr Wong said.
Boustead traded unchanged at S$1.85 a share on Tuesday before the results were announced.
