Yongnam's revenue up 20%, profit plunges 87%

AS forewarned, steel contractor and civil engineering group Yongnam Holdings rounded off a horrid 2013 by reporting net profit of $5.5 million, 87 per cent lower that the $43.5 million for the year before.

The profit plunge occurred despite revenue rising 20 per cent to $362 million. Other than lower margins from a change in project mix, Yongnam was plagued by significant cost overruns for three structural steelwork projects including the Singapore Sports Hub. It was also hit by an $8.1 million one-off disposal loss after having to sell off some steel pipe piles when there was a delay in renewing the land lease to store them.

Yongnam also made a $5.1 million provision for an insolvent contractor not being able to pay them.