Soilbuild Construction Q4 profit falls 28% to S$5.6 million

SOILBUILD Construction Group's net profit fell by 28 per cent in the fourth quarter to S$5.6 million, or 0.84 Singapore cents per share, as gross margins shrank.

For the full year ended December, net profit declined by 11 per cent to S$18.6 million, or 2.79 Singapore cents per share. The construction company is declaring a cash payout of 1.5 Singapore cents per share, comprising a 0.5-cent-per-share final dividend and a one-cent-per-share special dividend.

Revenue rose by 44 per cent during the quarter to S$98.0 million, but cost of sales grew at a faster clip of 55 per cent to S$90.0 million.

That dragged gross profit to a 20 per cent pullback, to S$8.1 million, as gross profit margin shrank to 8.2 per cent from a year-ago 14.8 per cent.

Soilbuild Construction said it recognised more revenue from projects with lower gross profit margins during the quarter.

Looking ahead, Soilbuild Construction said it has an order book of about S$639.0 million as at Dec 31, 2015. That excludes a S$13.4 million construction project in Myanmar that was secured in 2016. The company is cautiously optimistic that it will remain profitable in 2016.