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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.

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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.