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OKP net profit up 65% in Q1 despite fall in revenue

CONSTRUCTION firm OKP Holdings' net profit rose 65 per cent in the first quarter despite a fall in revenue, as cost of works slipped even more thanks to lower sub-contracting costs.

Net profit increased from S$1.13 million a year ago to S$1.85 million for the three months ended March 31.

This translates to earnings per share of 0.6 Singapore cent, up from 0.37 cent a year ago.

The group's revenue dropped 10 per cent to S$24.6 million, as a large reduction in sales in the maintenance business was only partially offset by a marginal increase in construction revenue.

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The lower costs incurred for specialised works such as bored piling and landscaping that are usually contracted to external vendors helped to boost gross profit margin from 9.9 per cent a year ago to 12.1 per cent.

While rising business costs and a shortage of experienced manpower continue to weigh on the industry and business environment, the firm said that it remains optimistic on its near-term prospects due to the pipeline of projects secured last year, as well as a S$9.8 million PUB contract bagged in February this year.

Its net construction order book stood at S$322.1 million as at March 31.