CFA Society Singapore
SINGAPORE (Mar 1): Starburst Holdings, the firearms-training facilities provider, swung back into profitability in FY17 with earnings of $0.1 million compared to a loss of $11.7 million in FY16.
This was due to improved margins and a significant decline in project and production costs.
Revenue declined 13.3% to $15.9 million in FY17 from $18.3 million in FY16, due to the lower contributions from projects undertaken in the full year under review.
Revenue contribution in FY17 came from a firearm shooting range project in the Middle East, two small indoor shooting range projects, a security detention facility project and a supply and installation of entry training equipment project in Southeast Asia.
In comparison, projects in FY16 comprised primarily of fabrication and installation work at Marina One architectural steel project at Marina Way in Singapore as well as design and fabrication work phases for three firearm shooting range projects in the Middle East.
Notably, project and production costs fell 63.6% to $7.7 million in FY17 from $21.2 million in FY16, in line with the decrease in revenue and also due to lower sub-contractors and overhead costs.
Correspondingly, gross profit margin improved to 51.3% in FY17 from –16% in FY16.
A final dividend 0.25 cent has been declared for the period under review, representing a dividend payout of approximately $0.6 million.
Looking ahead, Starburst says it continues to see a healthy level of enquiries from law enforcement-related customers as they respond to the threat of terrorism and extremism, against the backdrop of geopolitical instability and the rising levels of security threats globally.
The group says it also remains committed to deliver more projects to its customers in both Southeast Asia and the Middle East.
“We are pleased to end FY2017 with a profit, which is testament to our efforts in effectively managing our project and production costs. Moving forward, we will continue to pursue opportunities to design and engineer customised security training solutions for our existing and potential customers,” says Edward Lim, executive chairman of Starburst.
Shares in Starburst closed 1 cent lower at 39 cents on Thursday.