Chip Eng Seng posts S$99k H1 net profit, reversing year-ago loss

THINGS are looking up at Chip Eng Seng. The property player is back in the black with a S$99,000 net profit for the half-year ended June, a turnaround from its year-ago loss of S$24.4 million.

Chip Eng Seng posted a H1 revenue of S$622.4 million, more than double the previous year's H1 topline of S$290 million. This was due to the low base in H1, when most construction activities ceased during the circuit breaker.

The construction segment recorded the biggest revenue jump of 182.2 per cent to S$164.6 million, on the back of several projects, as well as new revenue contribution from CES_Salcon, which was acquired last December.

Revenue in the property development segment rose 112.4 per cent to S$419.1 million. This was due to the sale of the development site in Gladstone Street in south Melbourne and higher contributions from two condominium projects, Park Colonial and Kopar At Newton.

The Mainboard-listed company's education segment also ran up a 50.7 per cent rise in revenue to S$17.3 million, with higher contributions from the Invictus-brand international schools and Primus Schoolhouse.

However, revenue from the hospitality and property investment divisions both declined 5.9 per cent and 10.4 per cent respectively. This was due to lower contributions from Park Hotel Alexandra and lower occupancy in CES Centre.

Chip Eng Seng's share of losses from joint ventures were also higher due to fair-value losses on investment properties, and its share of losses from Cybint International Group, which was acquired in September last year.

Looking ahead, Chip Eng Seng is committed in replenishing its land bank for its property-development business in Singapore and overseas, as well as bidding for public-sector projects in construction.

"While the road to recovery for the hospitality industry remains uncertain amid the global roll-out of vaccine and resurgence of new variants, the group will focus on cost containment to mitigate the adverse impact from the curtailed international travel," it added.

Shares of Chip Eng Seng closed at S$0.45 on Thursday, up 1.1 per cent.

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