KSH's Q1 net profit shrinks 3.8% to S$6m

HIGHER expenses and deeper losses in its share of results from associates dented results for KSH Holdings (KSH) in its first quarter.

Net profit slid 3.8 per cent to S$6 million from the previous year, the group said in a Singapore Exchange filing on Friday evening.

The cost of construction rose 45.8 per cent to S$28.9 million, mainly due to the increase in construction works carried out and provision for anticipated losses on an ongoing construction project. Finance, tax and other operating costs also rose.

Also,  share of results of associates amounted to a loss of S$3.1 million in the quarter, deeper than the S$2.5 million loss a year ago, because of higher expenses incurred on three property development projects prior to the sales launch.

That said, the share of results of joint ventures improved from S$1.8 million in the corresponding year-ago quarter to S$2.5 million in the latest quarter, thanks to profit recognised from High Park Residences as the construction progressed.

For the three months ended June 30, revenue climbed 31.3 per cent to S$40.8 million from the year-ago period. The increase in revenue was mainly due to higher revenue from its construction business, offset by a decrease in rental income from its investment property in Tianjin, China.

Earnings per share slipped to 1.05 Singapore cents from 1.09 Singapore cents in the previous year.Net asset value per share edged up to 60.06 Singapore cents as at June 30, from 59.33 Singapore cents three months ago.

Separately, the group also announced that it has won a S$28 million construction contract, expected to start in August this year and complete in 2020. 

Including a letter of intent disclosed last November received by a 35-per-cent-owned associated company of the group for a S$266.3 million construction contract to be awarded, the latest award will lift KSH's construction order book in Singapore to more than S$588 million. 

"The order book is expected to contribute to the group's financial results up to FY2021," it said.

KSH shares closed flat at S$0.61 on Friday.