SINGAPORE (Feb 26): Hock Lian Seng, the construction company with a focus on infrastructure projects, reported a 45% fall in FY17 earnings to $19.8 million from $35.9 million.
This came on the back of higher cost of sales and lower other income and share of results from JV.
Full-year revenue rose 27.9% to $151.1 million mainly led by its Civil Engineering segment which recorded a 27% rise in revenue to $149.6 million.
This was due to the much higher contribution from Changi Airport JV project which progressed to a more active phase in 2017.
Property Development posted revenue of $1.3 million related to sales of unit at Ark@Gambas.
Revenue from Investment property segment remained insignificant.
Cost of sales rose 41.1% to $123.9 million. Gross profit fell 10.4% to $27.1 million.
Other income fell 19% to $3.9 million mainly due to the reduction in interest income.
There was also a provision for impairment loss of investment securities of $1.1 million due to the default risk for some held-to-maturity investment securities.
Other operating cost increased by $0.77 million mainly due to exchange loss arises for the revaluation of USD holdings for USD committed material purchases.
Share of profits from the joint venture was only $490,000 related to a writeback of project cost for Skywoods.
As at end Dec, Hock Lian Seng's order book for on-going projects of civil engineering segment was $775 million for the Maxwell station, the two Changi Airport projects and Stabling at Gali Batu Depot.
Construction of the group’s new industrial development property at Tuas -- Shine@Tuas South -- has started and is expected to be completed in 2Q18.
The board has proposed a first and final cash dividend of 1.8 cents per share.
Shares in Hock Lian Seng closed 1 cent higher at 51 cents on Monday.
