OKP swings into red for Q4, posts net loss of S$1.8m

CONSTRUCTION firm OKP Holdings on Friday posted a net loss of S$1.8 million for the fourth quarter ended Dec 31, compared to a net profit of S$2.7 million in the previous year.

The net loss came as cost of sales jumped 76.1 per cent to S$20.4 million, mainly on higher costs for sub-contracting, construction materials, overheads and labour costs.

Revenue climbed 20.5 per cent to S$22.1 million from S$18.4 million previously. Loss per share was 0.57 Singapore cent versus earnings per share of 0.88 cent in Q4 2018.

For the full year, OKP registered a net loss of about S$378,000 versus a net profit of S$6.5 million in FY2018. Gross profit margin fell as a result of a more competitive pricing environment and rising manpower costs.

Meanwhile, revenue fell 10 per cent to S$81.4 million while loss per share of 0.12 cent contrasted with earnings per share of 2.10 cents in FY2018.

The group expects the cost of construction and other operating costs to continue rising amid a challenging operating environment and the Covid-19 outbreak. It remains cautiously optimistic, given its healthy pipeline of construction projects with an order book of S$283.1 million as at Dec 31, 2019.

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Group managing director Or Toh Wat said the company will focus on diversifying its business, improving productivity through technology and upgrading its talent pool in the years ahead.

"Heading into a new decade, as we execute our strategy, we will look to widen our presence in more industry sectors and diversify our earnings through property development and other investments, for continuous business growth," he said.

The board has declared a final dividend of 0.7 cent per share, compared to final and special dividends totalling one cent in the corresponding period of the previous year.

OKP shares closed down one cent or 5.3 per cent to S$0.18 on Friday before the results were announced.