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Hong Leong Asia posts 39.1% hike in full-year net profit to S$34.4m

HONG Leong Asia recorded a 39.1 per cent hike in net profit to S$34.4 million for the year ended Dec 31, 2019, on account of higher business volumes and better contribution margins by its Building Materials Unit (BMU),  said the industrial conglomerate on Tuesday.

Other income, which comprised mainly interest income and government grants, increased 46.6 per cent to S$71.5 million from the year before, as its subsidiary Yuchai benefited from higher government grants and interest income in 2019.

Selling and distribution expenses, however, rose 20.0 per cent to S$296.5 million for the same period, largely from higher warranty expenses, additional allowance for doubtful debts and higher freight costs, it said.

Revenue for the same period rose 8.4 per cent, to S$4.1 billion, due to higher revenue recorded by Diesel Engines Unit Yuchai and BMU.

Yuchai’s revenue increased by S$250.0 million or 7.6 per cent from the year before, having sold 376,148 engines in 2019, marginally higher than 375,731 units sold in 2018. This was due to stronger sales in industrial and agricultural engines, which were partially offset by weaker sales in the bus and truck engine segments.

BMU’s revenue increased by S$77.6 million or 18.1 per cent from 2018, as both its Singapore and Malaysian operations reported higher year-on-year revenue.

Earnings per share for the year was S$4.61, reversing from a loss per share of S$1.37 the year before.

Shares of Hong Leong Asia closed up S$0.025 or 6.5 per cent to S$0.41 on Tuesday before the results were released.

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