KEONG Hong Holdings' net profit declined by 15.6 per cent for its fiscal first quarter to S$4.8 million, or 2.12 Singapore cents per share, as it recognised less revenue from construction projects, the construction and property development company announced on Wednesday after the market closed.
Revenue in the three months ended December 2015 slipped 6.3 per cent in the absence of the Twin Waterfalls and Alexandra Central Phase 2 projects, which were completed in 2015. Two new projects, at the Raffles Hospital Extension and Parc Life, were also at their initial revenue recognition stage in the reported quarter.
Gross profit margin actually improved by half a percentage point to 10.8 per cent during the quarter, but administration expenses jumped 70.5 per cent, or S$1.2 million, to S$2.9 million due to a S$0.6 million depreciation from a new light industry factory at Sungei Kadut and higher staff costs.
The company said that it has stepped up efforts to secure public-sector construction works, especially in the institutional and healthcare sectors. Its construction order book stood at about S$395 million through fiscal 2018. On the hotel development and investment side, Keong Hong said that its Holiday Inn Express Singapore Katong and Hotel Indigo Singapore Katong are expected to be operational in the current year.