Oxley Holdings H1 net profit falls to S$277,000 on lower revenue

MAINBOARD-LISTED Oxley Holdings reported on Wednesday (Feb 1) a sharp decline in net profit for its first half on the back of lower revenue and higher finance costs.

Net profit for the six-month period ended Dec 31, 2022 fell to S$277,000 from S$23.5 million in the corresponding period a year ago.

The group said in the bourse filing that the lower profits were due to “lower revenue streams coupled with higher finance costs resulting from rising interest rates and lower mark-to-market fair-value gain on derivative financial instruments”.

Revenue fell 13 per cent on year in the first half of FY23 to S$438.4 million, mainly due to the absence of a one-time sale of land parcels in Australia of S$97.1 million in H1 FY22. This was partially offset by higher revenue contribution from Singapore development projects and hotels in H1 FY23.

Net asset value per share for the group fell to S$0.2446 as at Dec 31, 2022, down from S$0.2507 as at June 30, 2022.

The group had cash and cash equivalents of S$152.9 million and a gearing ratio of 1.89 as at Dec 31, 2022, compared with cash and cash equivalents of S$143.9 million and a gearing ratio of 1.99 as at June 30, 2022.

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“Barring any unforeseen circumstances, with the group’s Singapore development projects expected to achieve Temporary Occupation Permits in 2023, the group’s net gearing ratio is expected to improve over the next 12 months,” Oxley said.

It noted that more than 99 per cent of its ongoing Singapore development units have been sold as at Jan 3 this year.

“The uncertainties in the global economy and Russia-Ukraine conflict, coupled with rising interest rates have resulted in subdued investments across the globe,” Oxley chief executive Ching Chiat Kwong said in a statement.

He added: “Oxley sees opportunities but we will take cautious steps and continue to strengthen the group’s financial position with the disposal of non-core assets to focus on the development projects in the developed markets.”

No dividend has been declared, unchanged from the previous year. The property developer said this was “in order to preserve the group’s working capital”.

Oxley shares closed unchanged at S$0.145 on Wednesday, before the earnings announcement.