SINGAPORE (Feb 13): Tat Hong Holdings reported its third straight FY18 quarter in the red with a loss of $2.3 million compared to the $1.2 million profit in 3Q17.
In its results announcement on Tuesday, the group attributed its loss to the weak performance of its distribution division in Asean; lower gross profit in the crane rental division; lower operating income; foreign exchange (forex) losses; as well as lower share of profit from associates and joint ventures (JVs).
Revenue for the quarter remained relatively steady at $122.9 million, down by 1% from $121.5 million a year ago.
The decrease was mainly due to lower contributions from the distribution division due to lower crane equipment sales across various markets, largely offset by higher contributions from the group’s crane rental, tower crane rental, and general equipment rental divisions.
Other operating income however fell to $2.7 million from $16.3 million previously on the absence of one-off items such as the recovery of receivables under guarantee, as well as again on the disposal of a property in Australia.
For the nine months ended Dec 2017, Tat Hong saw losses widened to $9.5 million from a loss of $5.8 million in 9M17.
In its outlook, Tat Hong cautions there may be “pockets of weaknesses” arising from challenging market conditions in certain parts of the Asean region, as well as newly-announced environmental regulations affecting the Beijing area.
The group nonetheless remains positive on the business climate for the crane rental market and other sectors in which it operates in China and Australia, and says it will continue its fleet rationalisation activities while taking advantage of its strong presence in China to explore the country’s Belt and Road initiative.
Shares in Tat Hong closed flat at 48 cents on Tuesday.
