JEP Holdings FY2019 net profit nearly triples to S$6.5m

JEP Holdings nearly tripled its FY2019 net profit to S$6.5 million from S$2.2 million a year ago, on the back of higher revenue from its precision manufacturing business, it said on Monday.

The precision machining and engineering services provider posted a 3.6 per cent rise in total revenue to S$89 million for the full year ended Dec 31, up from S$85.9 million previously.

JEP also improved its gross margin to 18 per cent from 15 per cent, a result of an initiative to move some labour-intensive work to a region with lower operational costs, other cost-controlling initiatives and lesser provision of stock obsolescence in the year under review.

Earnings per share was 1.61 Singapore cents compared with 0.578 cent in FY2018.

The group noted that the aerospace segment remains its key revenue source, and the segment should be supported by growing air traffic demand into the new decade.

Its oil and gas segment continues to face challenges from uncertainties due to tensions in the Middle East and pressures from the US-China trade war. JEP has been pursuing enquiries from new customers while continuing to work with existing ones on cost-reduction initiatives.

The company has moved most of its non-critical manufacturing activities in the semiconductor industry to a lower operation cost region, which has allowed it to increase its capacity to cope with higher demand expected in 2020.

JEP shares closed at S$0.22 on Monday, down one cent or 4.35 per cent.