Security services and solutions provider Secura Group posted earnings of $2.09 million for 1H2020, up from last year’s earnings of $216,000. This is largely due to government support grants and a decrease in operating expenses. The increase in earnings was partially offset by Secura’s share of losses from Custodio Technologies Pte Ltd, in which it owns a 20% stake.
For 1H2020 ended June 30, Secura Group’s earnings per share (EPS) grew slightly over 10 times y-o-y to 0.52 cents from 0.05 cents in 1H2019. Revenue decreased by 15.2% y-o-y to $16.89 million in 1H2020, owing to declines across various segments during the circuit breaker period.
Secura Group saw a decrease in revenue of $3.83 million or 27.8% y-o-y from the security guarding segment due to loss of contracts. This is on top of a decrease in revenue of $0.44 million or 63.4% y-o-y from the system integration segment due to the extended lockdown for the construction industry.
Even printing took a hit, with a decrease in revenue of $0.98 million or 24.8% y-o-y from the security printing segment due to a decrease in demand for printed products during the circuit breaker period in April and May, says Secura Group.
That said, outstanding orders from the previous year and new contracts for remote surveillance proved to be bright spots for Secura Group this half-year.
The digital forensic segment saw a sharp increase in revenue of $1.98 million or 572.1% y-o-y with the fulfilment of outstanding orders carried over from 2019 to 2020, and a notable 50.6% y-o-y increase in revenue of $0.21 million from security consultancy services with new contracts secured for remote surveillance and more ad-hoc guarding assignments, says Secura Group.
Cost of sales decreased by 17.4% y-o-y to $13.96 million in 1H2020, in line with the decrease in revenue.
Other operating income increased by $1.83 million to $2.57 million in 1H2020. This was primarily due to the jobs support scheme (JSS) grants from the government under the various budgets, amounting to $1.80 million for the period from April to June 2020.
Gross profit decreased by 2.7% y-o-y to $2.93 million, while gross profit margin improved from 15.1% in 1H2019 to 17.3% in 1H2020, “mainly due to the delivery of digital forensic products which has higher gross profit margin”
“The foreign worker levy rebates and fee waivers granted by the Singapore government during the Covid-19 period had further cushioned the decrease in gross profit margin in the security guarding segment,” says Secura Group.
As at June 30, the Group’s cash and cash equivalents amounted to $18.07 million, up from $14.05 million this time last year.
On April 6, Kestrel Investments bought 1,105,000 Secura Group shares at $41,990, or an average of 3.8 cents per share. Kestrel Investments is wholly owned by Peter Lim, the former “Remisier King”. As of April 17, Kestrel owns just over 165 million shares, or 41.26%, in Secura Group, making it the largest shareholder.
Secura Group has not declared a dividend for 1H2020, saying it “intends to deploy its cash reserves for the purposes of the Group’s development and operations”.
As at August 6, shares in Secura closed 0.1 cent lower, or 1.03% down, at 9.6 cents.