GKE posts Q1 net profit of S$254,000 on concrete plant contributions

LOGISTICS provider GKE Corp on Friday posted a net profit of S$254,000 for Q1 ended August, a reversal from the S$302,000 loss a year ago.

This translates to an earnings per share of 0.03 cent for the quarter, compared to a loss per share of 0.04 cent previously. 

The company posted a 33.7 per cent rise in revenue to S$25.4 million due to higher contributions from its ready-mix concrete manufacturing plant, Wuzhou Xing Jian Readymix, as well as an increase in storage and trucking from the logistics segment.

Topline growth was partly offset by a 39.1 per cent increase in cost of sales to S$21 million. Gross margin also declined to 17.2 per cent from 20.4 per cent a year ago. This was due to stiff competition in the warehousing and logistics segment. 

GKE generated S$1.1 million in net operating cash flows for Q1, down from S$1.8 million a year ago. As at end-August, it has S$16.5 million in cash and S$74.1 million in debt. 

Looking ahead, GKE said it is embarking on new projects in China, including a recycling plant for raw materials, adding that it is cautious about global trade tensions and will "manage its operating costs deriving synergies among the subsidiaries within its core warehousing and logistics division".

GKE shares closed at S$0.055 on Friday, up 0.4 cent.