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Hock Lian Seng net profit triples to S$25m on recognition of project revenue

Hock Lian Seng's nine-month net profit more than tripled to S$25.2 million, or 4.9 Singapore cents per share, mostly from revenue recognised from property development projects.

The infrastructure engineering company saw a threefold increase in revenue, to S$149.8 million, for the nine months ended September, as it recognised S$89 million of revenue from the industrial development property project Ark@KB in March and from the sale of additional units at Ark@Gambas. That revenue led to S$21.4 million of net profit from property development. The company had no revenue from property development in the year-ago period.

Hock Lian Seng's core civil engineering segment also saw revenue growth of 43.9 per cent, to S$53.4 million, during the nine-month period. Gross profit, however, shrank by a third to S$5 million because of lower margins for on-hand projects.

The company said it had an order book of about S$408 million for ongoing projects in its civil engineering segment. The company will also be building its own industrial development property at Tuas, with construction expected to start by the end of the year and completion slated for the first half of 2018.

About 75 per cent of the units at 50-per-cent joint venture residential project The Skywoods had been sold by end-September. Completion of the project is targeted for 2016.

Shares of Hock Lian Seng closed flat at 38.5 Singapore cents on Wednesday.